Exhibit 10.1


 


[EXECUTION]


 




 





[Published CUSIP Number:
                                ]


 


 


AMENDED AND RESTATED
CREDIT AGREEMENT



dated as of June 29, 2004


 


among


 


WESTERN GAS RESOURCES, INC.


as the Borrower


 


BANK OF AMERICA, N.A.


as Administrative Agent and L/C Issuer


 


BNP PARIBAS


JPMORGAN CHASE BANK


THE ROYAL BANK OF SCOTLAND plc


WACHOVIA BANK, NATIONAL ASSOCIATION


as Co-Syndication Agents


 


UNION BANK OF CALIFORNIA, N.A.


U.S. BANK NATIONAL ASSOCIATION


WELLS FARGO BANK, N.A.


as Co-Documentation Agents


 


AND


 


THE OTHER LENDERS PARTY HERETO


 












 


BANC OF AMERICA SECURITIES LLC,




as Sole Lead Arranger and Sole Book Manager


 





 

















 


TABLE OF CONTENTS


 


	
  Section

  	
   

  	
   

  
	
   

  	
   

  
	
  ARTICLE I.
  DEFINITIONS AND ACCOUNTING TERMS

  	
   

  
	
  1.01

  	
  Defined Terms

  	
   

  
	
  1.02

  	
  Other Interpretive
  Provisions

  	
   

  
	
  1.03

  	
  Accounting
  Terms.

  	
   

  
	
  1.04

  	
  Rounding

  	
   

  
	
  1.05

  	
  References to
  Agreements and Laws

  	
   

  
	
  1.06

  	
  Times of Day

  	
   

  
	
  1.07

  	
  Letter of
  Credit Amounts

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE II. THE
  COMMITMENTS AND CREDIT EXTENSIONS

  	
   

  
	
  2.01

  	
  Loans

  	
   

  
	
  2.02

  	
  Borrowings, Conversions
  and Continuations of Loans.

  	
   

  
	
  2.03

  	
  Letters of
  Credit.

  	
   

  
	
  2.04

  	
  Prepayments.

  	
   

  
	
  2.05

  	
  Termination or
  Reduction of Commitments

  	
   

  
	
  2.06

  	
  Repayment of Loans

  	
   

  
	
  2.07

  	
  Interest.

  	
   

  
	
  2.08

  	
  Fees

  	
   

  
	
  2.09

  	
  Computation of
  Interest and Fees

  	
   

  
	
  2.10

  	
  Evidence of Debt.

  	
   

  
	
  2.11

  	
  Payments
  Generally.

  	
   

  
	
  2.12

  	
  Sharing of Payments

  	
   

  
	
  2.13

  	
  Increase in
  Commitments.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE III.
  TAXES, YIELD PROTECTION AND ILLEGALITY

  	
   

  
	
  3.01

  	
  Taxes.

  	
   

  
	
  3.02

  	
  Illegality

  	
   

  
	
  3.03

  	
  Inability to
  Determine Rates

  	
   

  
	
  3.04

  	
  Increased Cost
  and Reduced Return; Capital Adequacy; Reserves on Eurodollar Rate Loans.

  	
   

  
	
  3.05

  	
  Funding Losses

  	
   

  
	
  3.06

  	
  Matters
  Applicable to all Requests for Compensation.

  	
   

  
	
  3.07

  	
  Survival

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IV.
  CONDITIONS PRECEDENT TO CREDIT EXTENSIONS

  	
   

  
	
  4.01

  	
  Conditions
  of Initial Credit Extension

  	
   

  
	
  4.02

  	
  Conditions to all
  Credit Extensions

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE V.
  REPRESENTATIONS AND WARRANTIES

  	
   

  
	
  5.01

  	
  Existence, Qualification
  and Power; Compliance with Laws

  	
   

  
	
  5.02

  	
  Authorization; No
  Contravention

  	
   

  
	
  5.03

  	
  Governmental
  Authorization; Other Consents

  	
   

  
	
  5.04

  	
  Binding Effect

  	
   

  
	
  5.05

  	
  Financial
  Statements; No Material Adverse Effect.

  	
   

  
	
  5.06

  	
  Litigation

  	
   

  
	
  5.07

  	
  No Default

  	
   

  



 


i

















 


	
  5.08

  	
  Ownership of
  Property; Liens

  	
   

  
	
  5.09

  	
  Environmental
  Compliance

  	
   

  
	
  5.10

  	
  Insurance

  	
   

  
	
  5.11

  	
  Taxes

  	
   

  
	
  5.12

  	
  ERISA
  Compliance.

  	
   

  
	
  5.13

  	
  Subsidiaries

  	
   

  
	
  5.14

  	
  Margin
  Regulations; Investment Company Act; Public Utility Holding Company Act.

  	
   

  
	
  5.15

  	
  Disclosure

  	
   

  
	
  5.16

  	
  Compliance
  with Laws

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VI.
  AFFIRMATIVE COVENANTS

  	
   

  
	
  6.01

  	
  Financial Statements

  	
   

  
	
  6.02

  	
  Certificates;
  Other Information

  	
   

  
	
  6.03

  	
  Notices

  	
   

  
	
  6.04

  	
  Payment
  of Obligations

  	
   

  
	
  6.05

  	
  Preservation of Existence,
  Etc.

  	
   

  
	
  6.06

  	
  Maintenance of
  Properties

  	
   

  
	
  6.07

  	
  Maintenance
  of Insurance

  	
   

  
	
  6.08

  	
  Compliance with
  Laws

  	
   

  
	
  6.09

  	
  Books and Records

  	
   

  
	
  6.10

  	
  Inspection
  Rights

  	
   

  
	
  6.11

  	
  Use of Proceeds

  	
   

  
	
  6.12

  	
  Guaranties of
  Borrower’s Subsidiaries

  	
   

  
	
  6.13

  	
  Additional Guarantors
  and Stock Pledge.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VII.
  NEGATIVE COVENANTS

  	
   

  
	
  7.01

  	
  Liens

  	
   

  
	
  7.02

  	
  Investments

  	
   

  
	
  7.03

  	
  Indebtedness

  	
   

  
	
  7.04

  	
  Fundamental
  Changes; Issuance of Stock

  	
   

  
	
  7.05

  	
  Dispositions

  	
   

  
	
  7.06

  	
  Restricted
  Payments

  	
   

  
	
  7.07

  	
  Change in Nature of
  Business

  	
   

  
	
  7.08

  	
  Transactions
  with Affiliates

  	
   

  
	
  7.09

  	
  Burdensome
  Agreements

  	
   

  
	
  7.10

  	
  Use of
  Proceeds

  	
   

  
	
  7.11

  	
  Limitation
  for Net Products Exposure

  	
   

  
	
  7.12

  	
  Financial
  Covenants.

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE VIII.
  EVENTS OF DEFAULT AND REMEDIES

  	
   

  
	
  8.01

  	
  Events of
  Default

  	
   

  
	
  8.02

  	
  Remedies
  Upon Event of Default

  	
   

  
	
  8.03

  	
  Application of
  Funds

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE IX.
  ADMINISTRATIVE AGENT

  	
   

  
	
  9.01

  	
  Appointment and
  Authorization of Administrative Agent.

  	
   

  
	
  9.02

  	
  Delegation of
  Duties

  	
   

  
	
  9.03

  	
  Liability of
  Administrative Agent

  	
   

  
	
  9.04

  	
  Reliance by
  Administrative Agent.

  	
   

  
	
  9.05

  	
  Notice of Default

  	
   

  
	
  9.06

  	
  Credit
  Decision; Disclosure of Information by Administrative Agent

  	
   

  
	
  9.07

  	
  Indemnification
  of Administrative Agent

  	
   

  



 


ii

















 


	
  9.08

  	
  Administrative
  Agent in its Individual Capacity

  	
   

  
	
  9.09

  	
  Successor Administrative
  Agent

  	
   

  
	
  9.10

  	
  Administrative
  Agent May File Proofs of Claim

  	
   

  
	
  9.11

  	
  Collateral
  and Guaranty Matters

  	
   

  
	
  9.12

  	
  Other Agents;
  Arrangers and Managers

  	
   

  
	
   

  	
   

  	
   

  
	
  ARTICLE X.
  MISCELLANEOUS

  	
   

  
	
  10.01

  	
  Amendments, Etc

  	
   

  
	
  10.02

  	
  Notices and
  Other Communications; Facsimile Copies.

  	
   

  
	
  10.03

  	
  No
  Waiver; Cumulative Remedies

  	
   

  
	
  10.04

  	
  Attorney
  Costs, Expenses and Taxes

  	
   

  
	
  10.05

  	
  Indemnification
  by the Borrower

  	
   

  
	
  10.06

  	
  Reimbursement
  by Lenders

  	
   

  
	
  10.07

  	
  Payments Set Aside

  	
   

  
	
  10.08

  	
  Successors and
  Assigns.

  	
   

  
	
  10.09

  	
  Confidentiality

  	
   

  
	
  10.10

  	
  Set-off

  	
   

  
	
  10.11

  	
  Interest Rate Limitation

  	
   

  
	
  10.12

  	
  Counterparts

  	
   

  
	
  10.13

  	
  Integration

  	
   

  
	
  10.14

  	
  Survival of
  Representations and Warranties

  	
   

  
	
  10.15

  	
  Severability

  	
   

  
	
  10.16

  	
  Tax Forms.

  	
   

  
	
  10.17

  	
  Replacement
  of Lenders

  	
   

  
	
  10.18

  	
  Governing Law.

  	
   

  
	
  10.19

  	
  Waiver of
  Right to Trial by Jury

  	
   

  
	
  10.20

  	
  ENTIRE
  AGREEMENT

  	
   

  
	
  10.21

  	
  Restatement

  	
   

  
	
  10.22

  	
  Return of Original Mortgage

  	
   

  
	
   

  	
   

  
	
  SIGNATURES

  	
   

  



 


iii

















 


SCHEDULES


 


	
  2.01

  	
  Commitments and Pro Rata Shares

  
	
  5.05

  	
  Material Indebtedness

  
	
  5.12

  	
  Erisa Compliance

  
	
  5.13

  	
  Subsidiaries and Other Equity Investments

  
	
  7.01

  	
  Existing Liens

  
	
  7.02

  	
  Joint Ventures

  
	
  7.03

  	
  Existing Indebtedness

  
	
  10.02

  	
  Administrative Agent’s Office, Certain Addresses for Notices

  



 


EXHIBITS


 


	
   

  	
  Form of

  
	
  A

  	
  Loan Notice

  
	
  B

  	
  Note

  
	
  C

  	
  Compliance Certificate

  
	
  D

  	
  Assignment and Assumption

  
	
  E

  	
  Guaranty

  
	
  F

  	
  Opinion Matters

  



 


iv

















 


CREDIT AGREEMENT


 


This CREDIT AGREEMENT (“Agreement”) is entered into as of
June 29, 2004, among WESTERN GAS RESOURCES, INC., a Delaware corporation
(the “Borrower”), each lender from time to time party hereto
(collectively, the “Lenders” and individually, a “Lender”), and
BANK OF AMERICA, N.A., as Administrative Agent and L/C Issuer.


 


The Borrower entered into a Credit Agreement, dated as of April 24,
2003, among the Borrower, Bank of America, N.A., as agent, and a syndicate of
lenders, as from time to time supplemented or amended (the “Existing Credit
Agreement”) pursuant to which such lenders made revolving loans to the
Borrower.


 


The Borrower has requested that the Lenders amend and restate the
Existing Credit Agreement in its entirety, and the Lenders are willing to do so
on the terms and conditions set forth herein.


 


In consideration of the mutual covenants and agreements herein
contained, the parties hereto covenant and agree as follows:


 


ARTICLE I.

DEFINITIONS AND ACCOUNTING TERMS


 


1.01                        Defined Terms.  As used in this Agreement, the following
terms shall have the meanings set forth below:


 


“Administrative Agent” means Bank of America in its capacity as
administrative agent under any of the Loan Documents, or any successor
administrative agent.


 


“Administrative Agent’s Office” means the Administrative Agent’s
address and, as appropriate, account as set forth on Schedule 10.02, or such other address or account as the
Administrative Agent may from time to time notify the Borrower and the Lenders.


 


“Administrative Questionnaire” means an Administrative
Questionnaire in a form supplied by the Administrative Agent.


 


“Affiliate” means, with respect to any Person, another Person
that directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the Person specified.  “Control” means the possession,
directly or indirectly, of the power to direct or cause the direction of the
management or policies of a Person, whether through the ability to exercise
voting power, by contract or otherwise. 
“Controlling” and “Controlled” have meanings correlative
thereto.  Without limiting the
generality of the foregoing, a Person shall be deemed to be Controlled by
another Person if such other Person possesses, directly or indirectly, power to
vote 15% or more of the securities having ordinary voting power for the
election of directors, managing general partners or the equivalent.


 

















 


“Agent-Related Persons” means the Administrative Agent, together
with its Affiliates (including, in the case of Bank of America in its capacity
as the Administrative Agent, the Arranger and the L/C Issuer), and the
officers, directors, employees, agents and attorneys-in-fact of such Persons
and Affiliates.


 


“Aggregate Commitments” means as of the date hereof the
Commitments of all the Lenders in the aggregate amount of $400,000,000 as
increased from time to time pursuant to Section 2.13.


 


“Agreement” means this Credit Agreement.


 


“Applicable Rate” means, from time to time, the following
percentages per annum for each category of Commitment Fee, Eurodollar Rate,
Letters of Credit and Base Rate set forth below, respectively, based upon the
Debt to Capitalization Ratio as set forth below:


 


Applicable Rate


 




	
   

  	
   

  	
  Debt to

  Capitalization

  Ratio

  	
   

  	
   

  	
   

  	
  Eurodollar

  Rate +

  	
   

  	
   

  	
   

  
	
  Pricing

  Level

  	
   

  	
   

  	
  Commitment

  Fee

  	
   

  	
  Letters of

  Credit

  	
   

  	
  Base Rate

  +

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1

  	
   

  	
  <0.30:1

  	
   

  	
  0.200

  	
  %

  	
  1.125

  	
  %

  	
  0.125

  	
  %

  
	
  2

  	
   

  	
  >0.30:1 <0.35:1

  	
   

  	
  0.250

  	
  %

  	
  1.250

  	
  %

  	
  0.250

  	
  %

  
	
  3

  	
   

  	
  >0.35:1
  <0.40:1

  	
   

  	
  0.300

  	
  %

  	
  1.375

  	
  %

  	
  0.375

  	
  %

  
	
  4

  	
   

  	
  >0.40:1
  <0.45:1

  	
   

  	
  0.375

  	
  %

  	
  1.500

  	
  %

  	
  0.500

  	
  %

  
	
  5

  	
   

  	
  >0.45:1

  	
   

  	
  0.375

  	
  %

  	
  1.750

  	
  %

  	
  0.750

  	
  %

  






 


Any increase or decrease in the Applicable Rate resulting from a change
in the Debt to Capitalization Ratio shall become effective as of the first
Business Day immediately following the date a Compliance Certificate is
delivered pursuant to Section 6.02(b); provided, however,
that (i) if the Borrower or a Subsidiary is making a significant acquisition or
selling significant assets, the Borrower may request a decrease or increase in
the Applicable Rate during a fiscal quarter and deliver to the Administrative
Agent and Lenders with such request proforma financial statements in form
acceptable to Administrative Agent together with a calculation of the Debt to
Capitalization Ratio based upon such financial statements and if Administrative
Agent determines that the Borrower’s calculation is correct, the reduced or
increased Applicable Rate shall become effective on the fifth Business Day
following the date on which notice thereof is given to Administrative Agent and
to Lenders, and (ii) if a Compliance Certificate is not delivered when due in
accordance with Section 6.02(b), then Pricing Level 5 shall apply
as of the first Business Day after the date on which such Compliance
Certificate was required to have been delivered.  The Applicable Rate in effect from the Closing Date through the
first Business Day thereafter on which such a Compliance Certificate is
received by Agent, shall be determined based upon Pricing Level 3.


 


2

















 


“Arranger” means Banc of America Securities LLC, in its capacity
as sole lead arranger and sole book manager.


 


“Assignment and Assumption” means an Assignment and Assumption
substantially in the form of Exhibit D.


 


“Attorney Costs” means and includes all reasonable fees,
expenses and disbursements of external counsel.


 


“Attributable Indebtedness” means, on any date, (a) in respect of
any capital lease of any Person, the capitalized amount thereof that would
appear on a balance sheet of such Person prepared as of such date in accordance
with GAAP, and (b) in respect of any operating lease of any Person, all future
payments owed under the lease or any Synthetic Lease Obligation, the
capitalized amount of the remaining lease payments under the relevant lease
that would appear on a balance sheet of such Person prepared as of such date in
accordance with GAAP if such lease were accounted for as a capital lease.


 


“Audited Financial Statements” means the audited consolidated
balance sheet of the Borrower and its Subsidiaries for the fiscal year ended
December 31, 2003, and the
related consolidated statements of income or operations, shareholders’ equity
and cash flows for such fiscal year of the Borrower and its Subsidiaries,
including the notes thereto.


 


“Availability Period” means the period from and including the
Closing Date to the earliest of (a) the Maturity Date, (b) the date of termination
of the Aggregate Commitments pursuant to Section 2.05, and (c) the
date of termination of the commitment of each Lender to make Loans and of the
obligation of the of the L/C Issuer to make L/C Credit Extensions pursuant to Section 8.02.


 


“Bank of America” means Bank of America, N.A. and its
successors.


 


“Base Rate” means for any day a fluctuating rate per annum equal
to the higher of (a) the Federal Funds Rate plus 1/2 of 1% and (b) the rate of
interest in effect for such day as publicly announced from time to time by Bank
of America as its “prime rate.”  The
“prime rate” is a rate set by Bank of America based upon various factors
including Bank of America’s costs and desired return, general economic
conditions and other factors, and is used as a reference point for pricing some
loans, which may be priced at, above, or below such announced rate.  Any change in such rate announced by Bank of
America shall take effect at the opening of business on the day specified in
the public announcement of such change.


 


“Base Rate Loan” means a Loan that bears interest based on the
Base Rate.


 


“Borrower” has the meaning specified in the introductory
paragraph hereto.


 


“Borrowing” means a Committed Borrowing.


 


“Business Day” means any day other than a Saturday, Sunday or
other day on which commercial banks are authorized to close under the Laws of,
or are in fact closed in, the state


 


3

















 


where the Administrative Agent’s Office is located and, if such day
relates to any Eurodollar Rate Loan, means any such day on which dealings in
Dollar deposits are conducted by and between banks in the London interbank
eurodollar market.


 


“Cash Collateralize” has the meaning specified in Section 2.03(g).


 


“Change of Control” means an event or series of events by which:


 


(a)                                  any
“person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, but excluding any employee benefit plan of
such person or its subsidiaries, and any person or entity acting in its
capacity as trustee, agent or other fiduciary or administrator of any such
plan) after the Closing Date becomes the “beneficial owner” (as defined in
Rules 13d-3 and 13d-5 under the Securities Exchange Act of 1934, except that a
person or group shall be deemed to have “beneficial ownership” of all
securities that such person or group has the right to acquire (such right, an “option
right”), whether such right is exercisable immediately or only after the
passage of time), directly or indirectly, of 25% or more of the equity
securities of the Borrower entitled to vote for members of the board of
directors of the Borrower on a fully-diluted basis (and taking into account all
such securities that such person or group has the right to acquire pursuant to
any option right); or


 


(b)                                 during
any period of 24 consecutive months, a majority of the members of the board of
directors of the Borrower cease to be composed of individuals (i) who were
members of that board or equivalent governing body on the first day of such
period, (ii) whose election or nomination to that board or equivalent governing
body was approved by individuals referred to in clause (i) above constituting
at the time of such election or nomination at least a majority of that board or
equivalent governing body or (iii) whose election or nomination to that board
or other equivalent governing body was approved by individuals referred to in
clauses (i) and (ii) above constituting at the time of such election or
nomination at least a majority of that board or equivalent governing body
(excluding, in the case of both clause (ii) and clause (iii), any individual
whose initial nomination for, or assumption of office as, a member of that
board or equivalent governing body occurs as a result of an actual or
threatened solicitation of proxies or consents for the election or removal of
one or more directors by any person or group other than a solicitation for the
election of one or more directors by or on behalf of the board of directors).


 


“Closing Date” means the first date
all the conditions precedent in Section 4.01 are satisfied or
waived in accordance with Section 4.01 (or, in the case of Section 4.01(b),
waived by the Person entitled to receive the applicable payment).


 


“Code” means the Internal Revenue Code
of 1986.


 


“Collateral” means all real and
personal property subject to the Security Documents.


 


4

















 


“Commitment” means, as to each Lender,
its obligation to (a) make Loans to the Borrower pursuant to Section 2.01
and (b) purchase participations in L/C Obligations, in an aggregate principal
amount at any one time outstanding not to exceed the amount set forth opposite
such Lender’s name on Schedule 2.01
or in the Assignment and Assumption pursuant to which such Lender becomes a
party hereto, as applicable, as such amount may be adjusted from time to time
in accordance with this Agreement.


 


“Commitment Fee” has the meaning
specified in Section 2.08(a)


 


“Commitment Letter” means that certain
agreement dated June 8, 2004, among the Borrower, Administrative Agent and
Arranger.


 


“Committed Borrowing” means a
borrowing consisting of simultaneous Loans of the same Type and, in the case of
Eurodollar Rate Loans, having the same Interest Period made by each of the
Lenders pursuant to Section 2.01.


 


“Compliance Certificate” means a
certificate substantially in the form of Exhibit C.


 


“Consolidated EBITDA” means, for any
period, EBITDA of the Borrower and its Subsidiaries for such period on a
consolidated basis


 


“Consolidated Funded Indebtedness”
means, as of any date of determination, for the Borrower and its Subsidiaries
calculated on a consolidated basis, the sum of (a) the outstanding principal
amount of all obligations, whether current or long-term, for borrowed money
(including Obligations hereunder) and all obligations evidenced by bonds,
debentures, notes, loan agreements or other similar instruments, (b) all
purchase money Indebtedness (e.g., seller financings), (c) all direct
obligations arising under letters of credit (including standby and commercial),
bankers’ acceptances, bank guaranties, surety bonds and similar instruments,
(d) all obligations in respect of the deferred purchase price of property or
services (other than trade accounts payable in the ordinary course of
business), (e) Attributable Indebtedness in respect of capital leases and
operating leases (but only the aggregate
amount thereof which at the time in question exceeds $35,000,000 excluding
Obligations arising under oil and gas leases, gas compressor and gas processing
plant site leases, real estate leases for office space used by the Borrower and
leases for vehicles, office equipment and data processing equipment)
and Synthetic Lease Obligations, (f) without duplication, all Guarantees with
respect to outstanding Indebtedness of the types specified in clauses (a)
through (e) above of Persons other than the Borrower or any Subsidiary, and (g)
all Indebtedness of the types referred to in clauses (a) through (f) above of
any partnership or joint venture (other than a joint venture that is itself a
corporation or limited liability company) in which the Borrower or a Subsidiary
is a general partner or joint venturer, unless such Indebtedness is expressly
made non-recourse to the Borrower or such Subsidiary.


 


“Consolidated Interest Charges” means,
for any period, Interest Charges for the Borrower and its Subsidiaries
calculated on a consolidated basis.


 


5

















 


“Consolidated Net Income” means, for
any period, Net Income for the Borrower and its Subsidiaries calculated on a
consolidated basis.


 


“Contractual Obligation” means, as to
any Person, any provision of any security issued by such Person or of any
agreement or instrument to which such Person is a party or by which it or any
of its property is bound.


 


“Control” has the meaning specified in
the definition of “Affiliate.”


 


“CP Debt” means unsecured Indebtedness
in the form of commercial paper issued by Borrower which meets the following
requirements: (i) such Indebtedness has a maturity of not more than 270 days
after the date of issuance thereof, (ii) the offering of such Indebtedness is
not required to be registered under the Securities Act of 1933, as amended,
(iii) such Indebtedness is not the subject of a Guarantee of any Loan Party,
(iv) at the time Borrower incurs such Indebtedness, no Default or Event of
Default shall have occurred and be continuing hereunder, and (v) the
documentation evidencing such Indebtedness shall contain no terms, conditions or
defaults (other than pricing and back-up availability under this Agreement)
which are more favorable to the third party creditor than those contained in
this Agreement are to Lenders, as determined by Required Lenders in their
discretion (provided that Required Lenders shall make any such determination at
the time the initial documentation covering the issuance of CP Debt is executed
and delivered and each time such documentation is modified, taking into
consideration any amendments or modifications to this Agreement then in
effect), and shall not contain any provision which attempts to modify, amend or
restrict any of the rights or remedies of Administrative Agent or Lenders
hereunder or under any of the other Loan Documents.


 


“Credit Extension” means each of the
following: (a) a Borrowing and (b) an L/C Credit Extension.


 


“Debt Rating” means, as of any date of
determination, the rating as determined by either S&P or Moody’s
(collectively, the “Debt Ratings”) of the Borrower’s Indebtedness under
this Agreement.


 


“Debtor Relief Laws” means the
Bankruptcy Code of the United States, and all other liquidation,
conservatorship, bankruptcy, assignment for the benefit of creditors,
moratorium, rearrangement, receivership, insolvency, reorganization, or similar
debtor relief Laws of the United States or other applicable jurisdictions from
time to time in effect and affecting the rights of creditors generally.


 


“Debt Securities” means the
$50,000,000 aggregate principal amount of 7.61% Senior Notes due July 28,
2007, $25,000,000 aggregate principal amount of 9.24% Senior Notes due
October 27, 2004, $25,000,000 aggregate principal amount of 6.36% Senior
Notes, Series H, due January 17, 2008, $100,000,000 aggregate principal
amount of 5.92% Senior Notes, Series I, due June 30, 2011, and all other
senior notes from time to time hereafter issued by the Borrower pursuant to
that certain Third Amended and Restated Master Shelf Agreement effective as of
January 13, 2003, between the Borrower and The Prudential Insurance Company
of America, Prudential Investment Management, Inc. (“Prudential”), Pruco Life
Insurance Company and


 


6

















 


certain Prudential Affiliates, as amended, supplemented, modified and
restated from time to time in an aggregate principal amount not to exceed
$375,000,000, outstanding at any time.


 


“Debt to Capitalization Ratio” means,
at the time of determination, the ratio of (a) Consolidated Funded Indebtedness
to (b) the sum of the Consolidated Funded Indebtedness plus Shareholders’
Equity.


 


“Default” means any event or condition
that constitutes an Event of Default or that, with the giving of any notice,
the passage of time, or both, would be an Event of Default.


 


“Default Rate” means (a) when used
with respect to Obligations other than Letter of Credit Fees, an interest rate
equal to (i) the Base Rate plus (ii) the Applicable Rate, if any,
applicable to Base Rate Loans plus (iii) 2% per annum; provided, however,
that with respect to a Eurodollar Rate Loan, the Default Rate shall be an
interest rate equal to the interest rate (including any Applicable Rate)
otherwise applicable to such Loan plus 2% per annum, in each case to the
fullest extent permitted by applicable Laws and (b) when used with respect to
Letter of Credit Fees, the Applicable Rate plus 2% per annum.


 


“Defaulting Lender” means any Lender
that, at the time of determination, (a) has failed to fund any portion of the
Loans or participations in L/C Obligations required to be funded by it
hereunder within one Business Day of the date required to be funded by it
hereunder, (b) has otherwise failed to pay over to the Administrative Agent or
any other Lender any other amount required to be paid by it hereunder within
one Business Day of the date when due, unless the subject of a good faith
dispute, or (c) has been deemed insolvent or become the subject of a bankruptcy
or insolvency proceeding.


 


“Disposition” or “Dispose”
means the sale, transfer, license, lease or other disposition (including any
sale and leaseback transaction) of any property by any Person, including any
sale, assignment, transfer or other disposal, with or without recourse, of any
notes or accounts receivable or any rights and claims associated therewith.


 


“Dollar” and “$” mean lawful
money of the United States.


 


“Domestic Subsidiary” means any
Subsidiary that is organized under the laws of any political subdivision of the
United States.


 


“EBITDA” means for any Person for any
period, an amount equal to Consolidated Net Income of such Person for such
period plus (a) the following to the extent deducted in calculating such
Consolidated Net Income: (i) Interest Charges for such period, (ii) the
provision for federal, state, local and foreign income taxes payable by such
Person for such period, (iii) the amount of depreciation and amortization
expense deducted in determining such Consolidated Net Income and (iv) other non
cash items deducted in determining such Consolidated Net Income and minus
(b) other non-cash items increasing such Consolidated Net Income for such
period.


 


“Eligible Assignee” has the meaning
specified in Section 10.08.


 


7

















 


“Environmental Laws” means any and all
federal, state, local, and foreign statutes, laws, regulations, ordinances,
rules, judgments, orders, decrees, permits, concessions, grants, franchises,
licenses, agreements or governmental restrictions relating to pollution and the
protection of the environment or the release of any materials into the
environment, including those related to hazardous substances or wastes, air
emissions and discharges to waste or public systems.


 


“Environmental Liability” means any
liability, contingent or otherwise (including any liability for damages, costs
of environmental remediation, fines, penalties or indemnities), of the
Borrower, any other Loan Party or any of their respective Subsidiaries directly
or indirectly resulting from or based upon (a) violation of any Environmental
Law, (b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) exposure to any Hazardous Materials,
(d) the release or threatened release of any Hazardous Materials into the
environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.


 


“ERISA” means the Employee Retirement
Income Security Act of 1974, as amended.


 


“ERISA Affiliate” means any trade or
business (whether or not incorporated) under common control with the Borrower
within the meaning of Section 414(b) or (c) of the Code (and Sections
414(m) and (o) of the Code for purposes of provisions relating to
Section 412 of the Code).


 


“ERISA Event” means (a) a Reportable
Event with respect to a Pension Plan; (b) a withdrawal by the Borrower or any
ERISA Affiliate from a Pension Plan subject to Section 4063 of ERISA
during a plan year in which it was a substantial employer (as defined in
Section 4001(a)(2) of ERISA) or a cessation of operations that is treated
as such a withdrawal under Section 4062(e) of ERISA; (c) a complete or
partial withdrawal by the Borrower or any ERISA Affiliate from a Multiemployer
Plan or notification that a Multiemployer Plan is in reorganization; (d) the
filing of a notice of intent to terminate, the treatment of a Plan amendment as
a termination under Sections 4041 or 4041A of ERISA, or the commencement of
proceedings by the PBGC to terminate a Pension Plan or Multiemployer Plan; or
(e) the imposition of any liability under Title IV of ERISA, other than for
PBGC premiums due but not delinquent under Section 4007 of ERISA, upon the
Borrower or any ERISA Affiliate.


 


“Eurodollar Rate” means for any
Interest Period with respect to any Eurodollar Rate Loan:


 


(a)                                  the
rate per annum equal to the rate determined by the Administrative Agent to be
the offered rate that appears on the page of the Telerate screen (or any
successor thereto) that displays an average British Bankers Association
Interest Settlement Rate for deposits in Dollars (for delivery on the first day
of such Interest Period) with a term equivalent to such Interest Period,
determined as of approximately 11:00 a.m. (London time) two Business Days prior
to the first day of such Interest Period, or


 


8

















 


(b)                                 if
the rate referenced in the preceding clause (a) does not appear on such page or
service or such page or service shall not be available, the rate per annum
equal to the rate determined by the Administrative Agent to be the offered rate
on such other page or other service that displays an average British Bankers
Association Interest Settlement Rate for deposits in Dollars (for delivery on
the first day of such Interest Period) with a term equivalent to such Interest
Period, determined as of approximately 11:00 a.m. (London time) two Business
Days prior to the first day of such Interest Period, or


 


(c)                                  if
the rates referenced in the preceding clauses (a) and (b) are not available,
the rate per annum determined by the Administrative Agent as the rate of
interest at which deposits in Dollars for delivery on the first day of such
Interest Period in same day funds in the approximate amount of the Eurodollar
Rate Loan being made, continued or converted by Bank of America and with a term
equivalent to such Interest Period would be offered by Bank of America’s London
Branch to major banks in the London interbank eurodollar market at their
request at approximately 4:00 p.m. (London time) two Business Days prior to the
first day of such Interest Period.


 


“Eurodollar Rate Loan” means a Loan that bears interest at a
rate based on the Eurodollar Rate.


 


“Event of Default” has the meaning specified in Section 8.01.


 


“Existing Credit Agreement” has the meaning specified in the
preamble of this Agreement.


 


“Existing Letters of Credit” means those letters of credit
issued by Administrative Agent under the Existing Credit Agreement prior to the
date hereof that are outstanding as of the date hereof.


 


“Federal Funds Rate” means, for any day, the rate per annum equal
to the weighted average of the rates on overnight Federal funds transactions
with members of the Federal Reserve System arranged by Federal funds brokers on
such day, as published by the Federal Reserve Bank of New York on the Business
Day next succeeding such day; provided that (a) if such day is not a
Business Day, the Federal Funds Rate for such day shall be such rate on such
transactions on the next preceding Business Day as so published on the next
succeeding Business Day, and (b) if no such rate is so published on such next
succeeding Business Day, the Federal Funds Rate for such day shall be the
average rate (rounded upward, if necessary, to a whole multiple of 1/100 of 1%)
charged to Bank of America on such day on such transactions as determined by
the Administrative Agent.


 


“Fee Letter” means the letter agreement, dated June 8,
2004, among the Borrower, the Administrative Agent and the Arranger.


 


“FERC” means any federal energy regulatory commission.


 


“Foreign Lender” has the meaning specified in Section 10.16(a)(i).


 


9

















 


“FRB” means the Board of Governors of the Federal Reserve System
of the United States.


 


“GAAP” means generally accepted accounting principles in the
United States set forth in the opinions and pronouncements of the Accounting
Principles Board and the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or
such other principles as may be approved by a significant segment of the
accounting profession in the United States, that are applicable to the
circumstances as of the date of determination, consistently applied.


 


“Governmental Authority” means any nation or government, any
state or other political subdivision thereof, any agency, authority,
instrumentality, regulatory body, court, administrative tribunal, central bank
or other entity exercising executive, legislative, judicial, taxing, regulatory
or administrative powers or functions of or pertaining to government.


 


“Guarantee” means, as to any Person, any (a) any obligation,
contingent or otherwise, of such Person guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation payable or
performable by another Person (the “primary obligor”) in any manner, whether
directly or indirectly, and including any obligation of such Person, direct or
indirect, (i) to purchase or pay (or advance or supply funds for the purchase
or payment of) such Indebtedness or other obligation, (ii) to purchase or lease
property, securities or services for the purpose of assuring the obligee in
respect of such Indebtedness or other obligation of the payment or performance
of such Indebtedness or other obligation, (iii) to maintain working capital, equity
capital or any other financial statement condition or liquidity or level of
income or cash flow of the primary obligor so as to enable the primary obligor
to pay such Indebtedness or other obligation, or (iv) entered into for the
purpose of assuring in any other manner the obligee in respect of such
Indebtedness or other obligation of the payment or performance thereof or to
protect such obligee against loss in respect thereof (in whole or in part), or
(b) any Lien (other than Permitted Liens as defined in Section 7.01)
on any assets of such Person securing any Indebtedness or other obligation of
any other Person, whether or not such Indebtedness or other obligation is
assumed by such Person.  The amount of
any Guarantee shall be deemed to be an amount equal to the stated or
determinable amount of the related primary obligation, or portion thereof, in
respect of which such Guarantee is made or, if not stated or determinable, the
maximum reasonably anticipated liability in respect thereof as determined by the
guaranteeing Person in good faith.  The
term “Guarantee” as a verb has a corresponding meaning.


 


“Guarantors” means MIGC, MGTC, MGR, WGRT, WGW, Lance and any
other Domestic Subsidiaries of the Borrower required to deliver a Guarantee of
the Obligations pursuant to Section 6.12.


 


“Guaranty” means the Guaranty made by the Guarantors in favor of
the Administrative Agent on behalf of the Lenders, substantially in the form of
Exhibit E.


 


“Hazardous Materials” means all explosive or radioactive
substances or wastes and all hazardous or toxic substances, wastes or other
pollutants, including petroleum or petroleum distillates, asbestos or
asbestos-containing materials, polychlorinated biphenyls, radon gas,


 


10

















 


infectious or medical wastes and all other substances or wastes of any
nature regulated pursuant to any Environmental Law.


 


“Indebtedness” means, as to any Person at a particular time,
without duplication, all of the following, whether or not included as indebtedness
or liabilities in accordance with GAAP:


 


(a)                                  all obligations of
such Person for borrowed money and all obligations of such Person evidenced by
bonds, debentures, notes, loan agreements or other similar instruments;


 


(b)                                 all
direct or contingent obligations of such Person arising under letters of credit
(including standby and commercial), bankers’ acceptances, bank guaranties,
surety bonds and similar instruments;


 


(c)                                  net
obligations of such Person under any Swap Contract;


 


(d)                                 all
obligations of such Person to pay the deferred purchase price of property or
services (other than trade accounts payable in the ordinary course of
business);


 


(e)                                  indebtedness
(excluding prepaid interest thereon) secured by a Lien on property owned or
being purchased by such Person (including indebtedness arising under
conditional sales or other title retention agreements), whether or not such
indebtedness shall have been assumed by such Person or is limited in recourse;


 


(f)                                    capital
leases, operating leases and Synthetic Lease Obligations;


 


(g)                                 all
Guarantees of such Person in respect of any of the foregoing;


 


(h)                                 obligations
with respect to payments received in consideration of oil, gas, or other
minerals yet to be acquired or produced at the time of payment (including obligations
under “take-or-pay” contracts to deliver gas in return for payments already
received and the undischarged balance of any production payment created by such
Person or for the creation of which such Person directly or indirectly received
payment); or


 


(i)                                     obligations
to deliver goods or services in consideration of advance payments therefor.


 


For all purposes hereof, the Indebtedness of
any Person shall include the Indebtedness of any partnership or joint venture
(other than a joint venture that is itself a corporation or limited liability
company) in which such Person is a general partner or a joint venturer, unless
such Indebtedness is expressly made non-recourse to such Person.  The amount of any net obligation under any
Swap Contract on any date shall be deemed to be the Swap Termination Value
thereof as of such date.  The remaining
amount of any capital lease, operating lease or Synthetic Lease Obligation as
of any date shall be deemed to be the amount of Attributable Indebtedness in
respect thereof as of such date.


 


11

















 


“Indemnified Liabilities” has the
meaning set forth in Section 10.05.


 


“Indemnitees” has the meaning set
forth in Section 10.05.


 


“Initial Financial Statements” means
the unaudited consolidated balance sheet of the Borrower and its Subsidiaries
for the fiscal quarter ended March 31, 2004, and the related consolidated
statements of income or operations, shareholders’ equity and cash flows for
such fiscal quarter of the Borrower and its Subsidiaries, including the notes
thereto.


 


“Intercreditor Agreement” means the
Intercreditor Agreement of even date herewith among Administrative Agent,
Lenders and Prudential Investment Management, Inc.


 


“Interest Charges” means for any
Person for any Period, all interest accrued during such Period by such Person
in connection with borrowed money (including capitalized interest) or in
connection with the deferred purchase price of assets, in each case to the
extent treated as interest in accordance with GAAP.


 


“Interest Coverage Ratio” means, as of
the end of any fiscal quarter, the ratio of (a) Consolidated EBITDA for the
four consecutive fiscal quarters then ended to
(b) Consolidated Interest Charges for such period.  For purposes of the “Interest Coverage Ratio,” EBITDA shall be
calculated excluding gains and losses on asset sales and other extraordinary
items.


 


“Interest Payment Date” means, (a) as
to any Loan other than a Base Rate Loan, the last day of each Interest Period
applicable to such Loan and the Maturity Date; provided, however,
that if any Interest Period for a Eurodollar Rate Loan exceeds three months,
the respective dates that fall every three months after the beginning of such
Interest Period shall also be Interest Payment Dates; and (b) as to any Base
Rate Loan, the last Business Day of each March, June, September and
December and the Maturity Date.


 


“Interest Period” means as to each
Eurodollar Rate Loan, the period commencing on the date such Eurodollar Rate
Loan is disbursed or converted to or continued as a Eurodollar Rate Loan and
ending on the date one, two, three or six months thereafter, as selected by the
Borrower in its Loan Notice; provided that:


 


(i)                                     any
Interest Period that would otherwise end on a day that is not a Business Day
shall be extended to the next succeeding Business Day unless, in the case of a
Eurodollar Rate Loan, such Business Day falls in another calendar month, in
which case such Interest Period shall end on the next preceding Business Day;


 


(ii)                                  any
Interest Period that begins on the last Business Day of a calendar month (or on
a day for which there is no numerically corresponding day in the calendar month
at the end of such Interest Period) shall end on the last Business Day of the
calendar month at the end of such Interest Period; and


 


(iii)                               no
Interest Period shall extend beyond the Maturity Date.


 


12

















 


“Investment” means, as to any Person, any direct or indirect
acquisition or investment by such Person, whether by means of (a) the purchase
or other acquisition of capital stock or other securities of another Person,
(b) a loan, advance or capital contribution to, Guarantee or assumption of debt
of, or purchase or other acquisition of any other debt or equity participation
or interest in, another Person, including any partnership or joint venture
interest in such other Person, or (c) the purchase or other acquisition (in one
transaction or a series of transactions) of assets of another Person that
constitute a business unit.  For
purposes of covenant compliance, the amount of any Investment shall be the
amount actually invested, without adjustment for subsequent increases or
decreases in the value of such Investment.


 


“IRS” means the United States Internal Revenue Service.


 


“Lance” means Lance Oil & Gas Company, Inc., a Delaware
corporation.


 


“Laws” means, collectively, all international, foreign, Federal,
state and local statutes, treaties, rules, regulations, ordinances, codes and
administrative or judicial precedents or authorities, including by any
Governmental Authority charged with the enforcement, interpretation or
administration thereof, and all applicable administrative orders, licenses,
authorizations and permits of, and agreements with, any Governmental Authority,
in each case whether or not having the force of law.


 


“L/C Advance” means, with respect to each Lender, such Lender’s
funding of its participation in any L/C Borrowing in accordance with its Pro
Rata Share.


 


“L/C Borrowing” means an extension of credit resulting from a
drawing under any Letter of Credit which has not been reimbursed on the date
when made or refinanced as a Committed Borrowing.


 


“L/C Credit Extension” means, with respect to any Letter of
Credit, the issuance thereof or extension of the expiry date thereof, or the
renewal or increase of the amount thereof.


 


“L/C Issuer” means Bank of America in its capacity as issuer of
Letters of Credit hereunder, or any successor issuer of Letters of Credit
hereunder.


 


“L/C Obligations” means, as at any date of determination, the
aggregate undrawn amount of all outstanding Letters of Credit plus the
aggregate of all Unreimbursed Amounts, including all L/C Borrowings.


 


“Lender” has the meaning specified in the introductory paragraph
hereto and, as the context requires, includes the L/C Issuer.


 


“Lending Office” means, as to any Lender, the office or offices
of such Lender described as such in such Lender’s Administrative Questionnaire,
or such other office or offices as a Lender may from time to time notify the
Borrower and the Administrative Agent.


 


13

















 


“Letter of Credit” means any letter of credit issued hereunder
and shall include the Existing Letters of Credit.  A Letter of Credit may be a commercial letter of credit or a
standby letter of credit.


 


“Letter of Credit Application” means an application and
agreement for the issuance or amendment of a Letter of Credit in the form from
time to time in use by the L/C Issuer.


 


“Letter of Credit Expiration Date” means the day that is seven
days prior to the Maturity Date then in effect (or, if such day is not a
Business Day, the next preceding Business Day).


 


“Letter of Credit Sublimit” means an amount equal to
$50,000,000.  The Letter of Credit
Sublimit is part of, and not in addition to, the Aggregate Commitments.


 


“Lien” means, with respect to any property or assets, any right
or interest therein of a creditor to secure Indebtedness owed to him or any
other arrangement with such creditor which provides for the payment of such
Indebtedness out of such property or assets or which allows him to have such
Indebtedness satisfied out of such property or assets prior to the general
creditors of any owner thereof, including any lien, mortgage, security
interest, pledge, deposit, production payment, rights of a vendor under any
title retention or conditional sale agreement or lease substantially equivalent
thereto, tax lien, mechanic’s or materialman’s lien, or any other charge or
encumbrance for security purposes, whether arising by law or agreement or
otherwise, but excluding any right of offset which arises without agreement in
the ordinary course of business.  “Lien”
also means any filed financing statement, any registration of a pledge (such as
with an issuer of uncertificated securities), or any other arrangement or
action which would serve to perfect a Lien described in the preceding sentence,
regardless of whether such financing statement is filed, such registration is
made, or such arrangement or action is undertaken before or after such Lien
exists.


 


“Loan” has the meaning specified in Section 2.01.


 


 “Loan Documents” means
this Agreement, each Note, the Letters of Credit, the Letter of Credit
Applications, the Fee Letter, the Commitment Letter, the Guaranty, the Security
Documents and all other agreements, certificates, documents, instruments and
writings at any time delivered in connection herewith or therewith (excluding
term sheets, commitment letters, correspondence and similar documents used in
the negotiation hereof and further excluding all offering memorandums prepared
by Administrative Agent or its Affiliates for use in connection with the
Loans).


 


“Loan Notice” means a notice of (a) a Committed Borrowing, (b) a
conversion of Loans from one Type to the other, or (c) a continuation of
Eurodollar Rate Loans, pursuant to Section 2.02(a), which, if in
writing, shall be substantially in the form of Exhibit A.


 


“Loan Parties” means, collectively, the Borrower and each
Guarantor.


 


“Material Adverse Effect” means (a) a material adverse change
in, or a material adverse effect upon, the operations, business, properties,
liabilities (actual or contingent), or financial condition of the Borrower or
the Borrower and its Subsidiaries taken as a whole ,provided,


 


14

















 


however, that a downgrade by S&P and/or Moody’s of their respective
Debt Rating shall not, in and of itself, be deemed to be a Material Adverse
Effect; (b) a material impairment of the ability of any Loan Party to perform
its obligations under any Loan Document to which it is a party; or (c) a
material adverse effect upon the legality, validity, binding effect or
enforceability against any Loan Party of any Loan Document to which it is a
party.


 


“Material Domestic Subsidiary” means a Domestic Subsidiary that
is required to execute and deliver a Guarantee pursuant to Section 6.12.


 


“Maturity Date” means June 29, 2009.


 


“MGTC” means MGTC, Inc., a Wyoming corporation.


 


“MGR” means Mountain Gas Resources, Inc., a Delaware
corporation.


 


“MIGC” means MIGC, Inc., a Delaware corporation.


 


“Moody’s” means Moody’s Investors Service, Inc. and any
successor thereto.


 


“Multiemployer Plan” means any employee benefit plan of the type
described in Section 4001(a)(3) of ERISA, to which the Borrower or any
ERISA Affiliate makes or is obligated to make contributions, or during the
preceding five plan years, has made or been obligated to make contributions.


 


“Net Income” means, for any period, for any Person, the net
income of the Borrower and its Subsidiaries for that period.


 


“Note” means a promissory note made by the Borrower in favor of
a Lender evidencing Loans made by such Lender, substantially in the form of Exhibit
B.


 


“Obligations” means all advances to, and debts, liabilities,
obligations, covenants and duties of, any Loan Party arising under any Loan
Document or otherwise with respect to any Loan or Letter of Credit, whether
direct or indirect (including those acquired by assumption), absolute or
contingent, due or to become due, now existing or hereafter arising and
including interest and fees that accrue after the commencement by or against
any Loan Party or any Affiliate thereof of any proceeding under any Debtor
Relief Laws naming such Person as the debtor in such proceeding, regardless of
whether such interest and fees are allowed claims in such proceeding.


 


“Organization Documents” means, (a) with respect to any
corporation, the certificate or articles of incorporation and the bylaws (or
equivalent or comparable constitutive documents with respect to any non-U.S.
jurisdiction); (b) with respect to any limited liability company, the
certificate or articles of formation or organization and operating agreement;
and (c) with respect to any partnership, joint venture, trust or other form of
business entity, the partnership, joint venture or other applicable agreement
of formation or organization and any agreement, instrument, filing or notice
with respect thereto filed in connection with its formation or organization
with the applicable Governmental Authority in the jurisdiction of its formation
or


 


15

















 


organization and, if applicable, any certificate or articles of
formation or organization of such entity.


 


“Outstanding Amount” means (i) with respect to Loans, on any
date, the aggregate outstanding principal amount thereof after giving effect to
any borrowings and prepayments or repayments of Loans, occurring on such date;
and (ii) with respect to any L/C Obligations on any date, the amount of such
L/C Obligations on such date after giving effect to any L/C Credit Extension
occurring on such date and any other changes in the aggregate amount of the L/C
Obligations as of such date, including as a result of any reimbursements of outstanding
unpaid drawings under any Letters of Credit or any reductions in the maximum
amount available for drawing under Letters of Credit taking effect on such
date.


 


“Participant” has the meaning specified in Section 10.08(d).


 


“PBGC” means the Pension Benefit Guaranty Corporation.


 


“Pension Plan” means any “employee pension benefit plan” (as
such term is defined in Section 3(2) of ERISA), other than a Multiemployer
Plan, that is subject to Title IV of ERISA and is sponsored or maintained by
the Borrower or any ERISA Affiliate or to which the Borrower or any ERISA
Affiliate contributes or has an obligation to contribute, or in the case of a
multiple employer or other plan described in Section 4064(a) of ERISA, has
made contributions at any time during the immediately preceding five plan
years.


 


“Permitted Lien” has the meaning set forth in Section 7.01.


 


“Person” means any natural person, corporation, limited
liability company, trust, joint venture, association, company, partnership,
Governmental Authority or other entity.


 


“Plan” means any “employee benefit plan” (as such term is
defined in Section 3(3) of ERISA) established by the Borrower or, with
respect to any such plan that is subject to Section 412 of the Code or
Title IV of ERISA, any ERISA Affiliate.


 


“Preferred Stock” means all issued and outstanding preferred
stock of the Borrower, which has been approved in writing by Required Lenders,
as the same may change from time to time.


 


“Pro Rata Share” means, with respect to each Lender at any time,
a fraction (expressed as a percentage, carried out to the ninth decimal place),
the numerator of which is the amount of the Commitment of such Lender at such
time and the denominator of which is the amount of the Aggregate Commitments at
such time; provided that if the commitment of each Lender to make Loans
and the obligation of the L/C Issuer to make L/C Credit Extensions have been
terminated pursuant to Section 8.02, then the Pro Rata Share of
each Lender shall be determined based on the Pro Rata Share of such Lender
immediately prior to such termination and after giving effect to any subsequent
assignments made pursuant to the terms hereof. 
The initial Pro Rata Share of each Lender is set forth opposite the name
of such Lender on Schedule 2.01
or in the Assignment and Assumption pursuant to which such Lender becomes a
party hereto, as applicable.


 


16

















 


“PUC Subsidiary” means any Subsidiary that is required to be
regulated as a public utility under applicable Law and that is prohibited under
such applicable Law from incurring a Guaranty and/or granting Liens or security
interests in any Collateral, in each case without the approval of the
applicable public utility commission having regulatory authority over such PUC
Subsidiary or FERC.


 


“Register” has the meaning set forth in Section 10.08(c).


 


“Reportable Event” means any of the events set forth in
Section 4043(c) of ERISA, other than events for which the 30 day notice
period has been waived.


 


“Request for Credit Extension” means (a) with respect to a
Borrowing, conversion or continuation of Loans, a Loan Notice and (b) with
respect to an L/C Credit Extension, a Letter of Credit Application.


 


“Required Lenders” means, as of any date of determination,
Lenders having more than 50% of the Aggregate Commitments or, if the commitment
of each Lender to make Loans and the obligation of the L/C Issuer to make L/C
Credit Extensions have been terminated pursuant to Section 8.02,
Lenders holding in the aggregate more than 50% of the Total Outstandings (with
the aggregate amount of each Lender’s risk participation and funded
participation in L/C Obligations being deemed “held” by such Lender for
purposes of this definition); provided that the Commitment of, and the
portion of the Total Outstandings held or deemed held by, any Defaulting Lender
shall be excluded for purposes of making a determination of Required Lenders.


 


“Responsible Officer” means (i) for all Loan Documents,
including Loan Notices, the chief executive officer, president, executive vice
president, chief financial officer, treasurer or assistant treasurer of a Loan
Party and (ii) in addition, for Loan Notices , the treasury director or senior
credit analyst of the Borrower.  Any
document delivered hereunder that is signed by a Responsible Officer of a Loan
Party shall be conclusively presumed to have been authorized by all necessary
corporate, partnership and/or other action on the part of such Loan Party and
such Responsible Officer shall be conclusively presumed to have acted on behalf
of such Loan Party.


 


“Restricted Payment” means (i) any dividend or other
distribution (whether in cash, securities or other property) with respect to
any capital stock or other equity interest of the Borrower or any Subsidiary,
or any payment (whether in cash, securities or other property), including any
sinking fund or similar deposit, on account of the purchase, redemption,
retirement, acquisition, cancellation or termination of any such capital stock
or other equity interest or of any option, warrant or other right to acquire
any such capital stock or other equity interest or (ii) any purchase,
repurchase, defeasance or prepayment of the Debt Securities or the Subordinated
Debt, excluding regularly scheduled payments of principal and interest.


 


“Risk Management Policy” means that certain Western Gas
Resources, Inc. Market Risk Management Policy, as approved by the Board of
Directors on September 20, 2002 and modified and approved by the Board of
Directors on November 20, 2003, as supplemented or amended


 


17

















 


from time to time, a true and correct copy of which has been delivered
to the Administrative Agent.


 


“S&P” means Standard & Poor’s Ratings Services, a
division of The McGraw-Hill Companies, Inc. and any successor thereto.


 


“SEC” means the Securities and Exchange Commission, or any
Governmental Authority succeeding to any of its principal functions.


 


“Security Documents” means all security agreements, deeds of
trust, mortgages, chattel mortgages, pledges, guaranties, financing statements,
continuation statements, extension agreements and other agreements or
instruments now, heretofore, or hereafter delivered by Borrower or any
Subsidiary to Administrative Agent in connection with this Agreement or any
transaction contemplated hereby to secure or guarantee the payment of any part
of the Obligations or the performance of the other duties and obligations of
Borrower or any Subsidiary under the Loan Documents.


 


“Senior Debt” means all of the Obligations and all Indebtedness
owing by Borrower and its Subsidiaries under the Debt Securities.


 


“Shareholders’ Equity” means the remainder of (i) Borrower’s
Consolidated assets minus (ii) the sum of (x) Borrower’s Consolidated
liabilities plus (y) all treasury stock of Borrower and its Subsidiaries plus
(z) all intangible assets of Borrower and its Subsidiaries (including without
limitation all patents, copyrights, licenses, franchises, goodwill, trade names
and trade secrets); provided that the term “Shareholder’s Equity” shall include
the book value of long-term gas contracts with producers that Borrower assumes
in connection with acquisitions that are reflected on the books of Borrower as
assets.


 


“Stock Pledge” means, collectively the pledge agreements
necessary to pledge all of the equity interests in the Material Domestic
Subsidiaries and 65% of the equity interests in Borrower’s foreign
Subsidiaries, in form and substance acceptable to Administrative Agent.


 


“Subordinated Debt” means unsecured Indebtedness issued by
Borrower that is subordinated by its terms to the Obligations and the Debt
Securities on terms acceptable to Required Lenders and guarantees thereof by
Borrower’s Subsidiaries each of which is subordinated by its terms to the
Obligations and the Debt Securities on terms acceptable to Required Lenders.


 


“Subsidiary” of a Person means a corporation, partnership, joint
venture, limited liability company or other business entity of which a majority
of the shares of securities or other interests having ordinary voting power for
the election of directors or other governing body (other than securities or
interests having such power only by reason of the happening of a contingency)
are at the time beneficially owned, or the management of which is otherwise
controlled, directly, or indirectly through one or more intermediaries, or
both, by such Person, provided that associations, joint ventures or other
relationships (a) which are established pursuant to a standard form operating
agreement or similar agreement or which are partnerships for purposes of
federal


 


18

















 


income taxation only, (b) which are not corporations or partnerships
(or subject to the Uniform Partnership Act) under applicable state law, and (c)
whose businesses are limited to the exploration, development and operation of
oil, gas, mineral, gas gathering or gas processing properties and interests
owned directly by the parties in such associations, joint ventures or
relationships, shall not be deemed to be “Subsidiaries” of such Person.  Unless otherwise specified, all references
herein to a “Subsidiary” or to “Subsidiaries” shall refer to a Subsidiary or
Subsidiaries of the Borrower.


 


“Swap Contract” means (a) any and all rate swap transactions,
basis swaps, credit derivative transactions, forward rate transactions,
commodity swaps, commodity options, forward commodity contracts, equity or
equity index swaps or options, bond or bond price or bond index swaps or
options or forward bond or forward bond price or forward bond index
transactions, interest rate options, forward foreign exchange transactions, cap
transactions, floor transactions, collar transactions, currency swap
transactions, cross-currency rate swap transactions, currency options, spot
contracts, or any other similar transactions or any combination of any of the
foregoing (including any options to enter into any of the foregoing), whether
or not any such transaction is governed by or subject to any master agreement,
and (b) any and all transactions of any kind, and the related confirmations,
which are subject to the terms and conditions of, or governed by, any form of
master agreement published by the International Swaps and Derivatives
Association, Inc., any International Foreign Exchange Master Agreement, or any
other master agreement (any such master agreement, together with any related
schedules, a “Master Agreement”), including any such obligations or
liabilities under any Master Agreement.


 


“Swap Termination Value” means, in respect of any one or more
Swap Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Swap Contracts, (a) for any date on or after
the date such Swap Contracts have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a), the amount(s) determined as
the mark-to-market value(s) for such Swap Contracts, as determined based upon
one or more mid-market or other readily available quotations provided by any
recognized dealer in such Swap Contracts (which may include a Lender or any
Affiliate of a Lender).


 


“Synthetic Lease Obligation” means the monetary obligation of a
Person under (a) a so-called synthetic, off-balance sheet or tax retention
lease, or (b) an agreement for the use or possession of property creating
obligations that do not appear on the balance sheet of such Person but which,
upon the insolvency or bankruptcy of such Person, would be characterized as the
indebtedness of such Person (without regard to accounting treatment), excluding
with respect to this clause (ii) agreements entered into in the ordinary course
of such Person’s business.


 


“Total Outstandings” means the aggregate Outstanding Amount of
all Loans and all L/C Obligations.


 


“Type” means with respect to a Loan, its character as a Base
Rate Loan or a Eurodollar Rate Loan.


 


19

















 


“Unfunded Pension Liability” means the excess of a Pension
Plan’s benefit liabilities under Section 4001(a)(16) of ERISA, over the
current value of that Pension Plan’s assets, determined in accordance with the
assumptions used for funding the Pension Plan pursuant to Section 412 of
the Code for the applicable plan year.


 


“United States” and “U.S.” mean the United States of
America.


 


“Unreimbursed Amount” has the meaning set forth in Section 2.03(c)(i).


 


“WGRT” means Western Gas Resources - Texas, Inc., a Texas
corporation and wholly-owned subsidiary of Borrower.


 


“WGW” means Western Gas Wyoming, L.L.C., a Wyoming limited
liability company.


 


1.02                        Other Interpretive Provisions.  With reference to this Agreement and each
other Loan Document, unless otherwise specified herein or in such other Loan
Document:


 


(a)                                  The
meanings of defined terms are equally applicable to the singular and plural
forms of the defined terms.


 


(b)                                 (i)                                     The
words “herein,” “hereto,” “hereof” and “hereunder”
and words of similar import when used in any Loan Document shall refer to such
Loan Document as a whole and not to any particular provision thereof.


 


(ii)                                  Article,
Section, Exhibit and Schedule references are to the Loan Document in which
such reference appears.


 


(iii)                               The
term “including” is by way of example and not limitation.


 


(iv)                              The
term “documents” includes any and all instruments, documents,
agreements, certificates, notices, reports, financial statements and other
writings, however evidenced, whether in physical or electronic form.


 


(c)                                  In
the computation of periods of time from a specified date to a later specified
date, the word “from” means “from and including;” the words “to”
and “until” each mean “to but excluding;” and the word “through”
means “to and including.”


 


(d)                                 Section headings
herein and in the other Loan Documents are included for convenience of
reference only and shall not affect the interpretation of this Agreement or any
other Loan Document.


 


1.03                        Accounting Terms.


 


(a)                                  All
accounting terms not specifically or completely defined herein shall be
construed in conformity with, and all financial data (including financial
ratios and other financial calculations) required to be submitted pursuant to
this Agreement shall be prepared in conformity with, GAAP applied on a
consistent basis, as in effect from time to time, applied in a


 


20

















 


manner
consistent with that used in preparing the Audited Financial Statements, except
as otherwise specifically prescribed herein.


 


(b)                                 If
at any time any change in GAAP would affect the computation of any financial
ratio or requirement set forth in any Loan Document, all reports and financial
statements required hereunder with respect to Borrower or with respect to
Borrower and its consolidated subsidiaries may be prepared in accordance with
such change but, if such change is material, all calculations and
determinations to be made hereunder may be made in accordance with such change
only after notice of such change is given to each Lender and Required Lenders
agree to such change insofar as it affects the accounting of Borrower or of
Borrower and its consolidated subsidiaries.


 


1.04                        Rounding.  Any financial ratios required to be
maintained by the Borrower pursuant to this Agreement shall be calculated by
dividing the appropriate component by the other component, carrying the result
to one place more than the number of places by which such ratio is expressed
herein and rounding the result up or down to the nearest number (with a
rounding-up if there is no nearest number).


 


1.05                        References to Agreements and Laws.  Unless otherwise expressly provided herein,
(a) references to Organization Documents, agreements (including the Loan
Documents) and other contractual instruments shall be deemed to include all
subsequent amendments, restatements, extensions, supplements and other
modifications thereto, but only to the extent that such amendments,
restatements, extensions, supplements and other modifications are not
prohibited by any Loan Document; and (b) references to any Law shall include
all statutory and regulatory provisions consolidating, amending, replacing,
supplementing or interpreting such Law.


 


1.06                        Times of Day.  Unless
otherwise specified, all references herein to times of day shall be references
to Central time (daylight or standard, as applicable).


 


1.07                        Letter of Credit Amounts.  Unless otherwise specified, all references herein to the amount
of a Letter of Credit at any time shall be deemed to mean the maximum face
amount of such Letter of Credit after giving effect to all increases thereof
contemplated by such Letter of Credit or the Letter of Credit Application
therefor, whether or not such maximum face amount is in effect at such time.


 


ARTICLE II.

THE COMMITMENTS AND CREDIT EXTENSIONS


 


2.01                        Loans.  Subject to the terms and conditions set
forth herein, each Lender severally agrees to make loans (each such loan, a “Loan”)
to the Borrower from time to time, on any Business Day during the Availability
Period, in an aggregate amount not to exceed at any time outstanding the amount
of such Lender’s Commitment; provided, however, that after giving
effect to any Committed Borrowing, (i) the Total Outstandings shall not exceed
the Aggregate Commitments, and (ii) the aggregate Outstanding Amount of the
Loans of any Lender, plus such Lender’s Pro Rata Share of the
Outstanding Amount of all L/C Obligations, shall not exceed


 


21

















 


such Lender’s Commitment. 
Within the limits of each Lender’s Commitment, and subject to the other
terms and conditions hereof, the Borrower may borrow under this Section 2.01,
prepay under Section 2.04, and reborrow under this Section 2.01.  Loans may be Base Rate Loans or Eurodollar
Rate Loans, as further provided herein.


 


2.02                        Borrowings, Conversions and Continuations of Loans.


 


(a)                                  Each
Committed Borrowing, each conversion of Loans from one Type to the other, and
each continuation of Eurodollar Rate Loans shall be made upon the Borrower’s
irrevocable notice to the Administrative Agent, which may be given by
telephone.  Each such notice must be
received by the Administrative Agent not later than 11:00 a.m. (i) three
Business Days prior to the requested date of any Borrowing of, conversion to or
continuation of Eurodollar Rate Loans or of any conversion of Eurodollar Rate
Loans to Base Rate Loans, and (ii) on the requested date of any Borrowing of
Base Rate Loans.  Each telephonic notice
by the Borrower pursuant to this Section 2.02 must be confirmed
promptly by delivery to the Administrative Agent of a written Loan Notice,
appropriately completed and signed by a Responsible Officer of the
Borrower.  Each Borrowing of, conversion
to or continuation of Eurodollar Rate Loans shall be in a principal amount of
$5,000,000 or a whole multiple of $1,000,000 in excess thereof.  Except as provided in Sections 3.02 and
3.03, each Borrowing of or conversion to Base Rate Loans shall be in a
principal amount of $250,000 or a whole multiple of $100,000 in excess
thereof.  Each Loan Notice (whether
telephonic or written) shall specify (i) whether the Borrower is requesting a
Committed Borrowing, a conversion of Loans from one Type to the other, or a
continuation of Eurodollar Rate Loans, (ii) the requested date of the
Borrowing, conversion or continuation, as the case may be (which shall be a Business
Day), (iii) the principal amount of Loans to be borrowed, converted or
continued, (iv) the Type of Loans to be borrowed or to which existing Loans are
to be converted, and (v) if applicable, the duration of the Interest Period
with respect thereto.  If the Borrower
fails to specify a Type of Loan in a Loan Notice or if the Borrower fails to
give a timely notice requesting a conversion or continuation, then the
applicable Loans shall be made as, or converted to, Base Rate Loans.  Any such automatic conversion to Base Rate
Loans shall be effective as of the last day of the Interest Period then in
effect with respect to the applicable Eurodollar Rate Loans.  If the Borrower requests a Borrowing of,
conversion to, or continuation of Eurodollar Rate Loans in any such Loan
Notice, but fails to specify an Interest Period, it will be deemed to have
specified an Interest Period of one month.


 


(b)                                 Following
receipt of a Loan Notice, the Administrative Agent shall promptly notify each
Lender of the amount of its Pro Rata Share of the applicable Loans, and if no
timely notice of a conversion or continuation is provided by the Borrower, the
Administrative Agent shall notify each Lender of the details of any automatic
conversion to Base Rate Loans described in the preceding subsection.  In the case of a Committed Borrowing, each
Lender shall make the amount of its Loan available to the Administrative Agent
in immediately available funds at the Administrative Agent’s Office not later
than 1:00 p.m. on the Business Day specified in the applicable Loan
Notice.  Upon satisfaction of the
applicable conditions set forth in Section 4.02 (and, if such
Borrowing is the initial Credit Extension, Section 4.01), the
Administrative Agent shall make all funds so received available to the Borrower
in like funds as received by the Administrative Agent either by (i) crediting
the account of the Borrower on the books of Bank of


 


22

















 


America with
the amount of such funds or (ii) wire transfer of such funds, in each case in
accordance with instructions provided to (and reasonably acceptable to) the
Administrative Agent by the Borrower; provided, however, that if,
on the date the Loan Notice with respect to such Borrowing is given by the
Borrower, there are L/C Borrowings outstanding, then the proceeds of such
Borrowing shall be applied, first, to the payment in full of any such
L/C Borrowings, second, to the Borrower as provided above.


 


(c)                                  Except
as otherwise provided herein, a Eurodollar Rate Loan may be continued or
converted only on the last day of an Interest Period for such Eurodollar Rate
Loan.  During the existence of a
Default, no Loans may be requested as, converted to or continued as Eurodollar Rate
Loans without the consent of the Required Lenders.


 


(d)                                 The
Administrative Agent shall promptly notify the Borrower and the Lenders of the
interest rate applicable to any Interest Period for Eurodollar Rate Loans upon
determination of such interest rate. 
The determination of the Eurodollar Rate by the Administrative Agent
shall be conclusive in the absence of manifest error.  At any time that Base Rate Loans are outstanding, the
Administrative Agent shall notify the Borrower and the Lenders of any change in
Bank of America’s prime rate used in determining the Base Rate promptly
following the public announcement of such change.


 


(e)                                  After
giving effect to all Committed Borrowings, all conversions of Loans from one
Type to the other, and all continuations of Loans as the same Type, there shall
not be more than ten  Interest
Periods in effect with respect to Loans.


 


2.03                        Letters of Credit.


 


(a)                                  The
Letter of Credit Commitment.


 


(i)                                     Subject
to the terms and conditions set forth herein, (A) the L/C Issuer agrees, in
reliance upon the agreements of the other Lenders set forth in this Section 2.03,
(1) from time to time on any Business Day during the period from the Closing
Date until the earlier of the (x) Letter of Credit Expiration Date or (y) the
last day of the Availability Period, to issue Letters of Credit for the account
of the Borrower or certain Subsidiaries, and to amend or renew Letters of
Credit previously issued by it, in accordance with subsection (b) below,
and (2) to honor drafts under the Letters of Credit; and (B) the Lenders severally
agree to participate in Letters of Credit issued for the account of the
Borrower; provided that the L/C Issuer shall not be obligated to make
any L/C Credit Extension with respect to any Letter of Credit, and no Lender
shall be obligated to participate in any Letter of Credit if as of the date of
such L/C Credit Extension, (x) the Total Outstandings would exceed the
Aggregate Commitments, (y) the aggregate Outstanding Amount of the Loans of any
Lender, plus such Lender’s Pro Rata Share of the Outstanding Amount of
all L/C Obligations, would exceed such Lender’s Commitment, or (z) the
Outstanding Amount of the L/C Obligations would exceed the Letter of Credit
Sublimit.  Within the foregoing limits,
and subject to the terms and conditions hereof, the Borrower’s ability to
obtain Letters of Credit shall be fully revolving, and accordingly the Borrower
may, during the foregoing period, obtain Letters


 


23

















 


of Credit to replace Letters of Credit that have expired or that have
been drawn upon and reimbursed.  All
Existing Letters of Credit shall be deemed to have been issued pursuant hereto,
and from and after the Closing Date shall be subject to and governed by the
terms and conditions hereof.


 


(ii)                                  The
L/C Issuer shall be under no obligation to issue any Letter of Credit if:


 


(A)                              any
order, judgment or decree of any Governmental Authority or arbitrator shall by
its terms purport to enjoin or restrain the L/C Issuer from issuing such Letter
of Credit, or any Law applicable to the L/C Issuer or any request or directive
(whether or not having the force of law) from any Governmental Authority with
jurisdiction over the L/C Issuer shall prohibit, or request that the L/C Issuer
refrain from, the issuance of letters of credit generally or such Letter of
Credit in particular or shall impose upon the L/C Issuer with respect to such
Letter of Credit any restriction, reserve or capital requirement (for which the
L/C Issuer is not otherwise compensated hereunder) not in effect on the Closing
Date, or shall impose upon the L/C Issuer any unreimbursed loss, cost or
expense which was not applicable on the Closing Date and which the L/C Issuer
in good faith deems material to it;


 


(B)                                subject
to Section 2.03(b)(iii), the expiry date of such requested Letter
of Credit would occur more than 12 months after the date of issuance or last
renewal, unless the Required Lenders have approved such expiry date;


 


(C)                                the
expiry date of such requested Letter of Credit would occur after the Letter of
Credit Expiration Date, unless all the Lenders have approved such expiry date;


 


(D)                               the
issuance of such Letter of Credit would violate one or more policies of the L/C
Issuer; or


 


(E)                                 such
Letter of Credit is in an initial amount less than $100,000, in the case of a
commercial Letter of Credit, or $500,000, in the case of a standby Letter of
Credit, or denominated in a currency other than Dollars.


 


(F)                                 a
default of any Lender’s obligations to fund under Section 2.03(c) exists
or any Lender is at such time a Defaulting Lender hereunder, unless the L/C
Issuer has entered into satisfactory arrangements with the Borrower or such
Lender to eliminate the L/C Issuer’s risk with respect to such Lender.


 


(iii)                               The
L/C Issuer shall be under no obligation to amend any Letter of Credit if (A)
the L/C Issuer would have no obligation at such time to issue such Letter of
Credit in its amended form under the terms hereof, or (B) the beneficiary of
such Letter of Credit does not accept the proposed amendment to such Letter of
Credit.


 


(b)                                 Procedures
for Issuance and Amendment of Letters of Credit; Auto-Renewal Letters of Credit.


 


24

















 


(i)                                     Each
Letter of Credit shall be issued or amended, as the case may be, upon the
request of the Borrower delivered to the L/C Issuer (with a copy to the
Administrative Agent) in the form of a Letter of Credit Application,
appropriately completed and signed by a Responsible Officer of the
Borrower.  Such Letter of Credit
Application must be received by the L/C Issuer and the Administrative Agent not
later than 11:00 a.m. at least two Business Days (or such later date and time
as the L/C Issuer may agree in a particular instance in its sole discretion)
prior to the proposed issuance date or date of amendment, as the case may
be.  In the case of a request for an
initial issuance of a Letter of Credit, such Letter of Credit Application shall
specify in form and detail satisfactory to the L/C Issuer: (A) the proposed
issuance date of the requested Letter of Credit (which shall be a Business
Day); (B) the amount thereof; (C) the expiry date thereof; (D) the name and
address of the beneficiary thereof; (E) the documents to be presented by such
beneficiary in case of any drawing thereunder; (F) the full text of any
certificate to be presented by such beneficiary in case of any drawing
thereunder; and (G) such other matters as the L/C Issuer may require.  In the case of a request for an amendment of
any outstanding Letter of Credit, such Letter of Credit Application shall
specify in form and detail satisfactory to the L/C Issuer (A) the Letter of
Credit to be amended; (B) the proposed date of amendment thereof (which shall
be a Business Day); (C) the nature of the proposed amendment; and (D) such
other matters as the L/C Issuer may require.


 


(ii)                                  Promptly
after receipt of any Letter of Credit Application, the L/C Issuer will confirm
with the Administrative Agent (by telephone or in writing) that the
Administrative Agent has received a copy of such Letter of Credit Application
from the Borrower and, if not, the L/C Issuer will provide the Administrative
Agent with a copy thereof.  Upon receipt
by the L/C Issuer of confirmation from the Administrative Agent that the
requested issuance or amendment is permitted in accordance with the terms
hereof, then, subject to the terms and conditions hereof, the L/C Issuer shall,
on the requested date, issue a Letter of Credit for the account of the Borrower
or enter into the applicable amendment, as the case may be, in each case in
accordance with the L/C Issuer’s usual and customary business practices.  Immediately upon the issuance of each Letter
of Credit, each Lender shall be deemed to, and hereby irrevocably and
unconditionally agrees to, purchase from the L/C Issuer a risk participation in
such Letter of Credit in an amount equal to the product of such Lender’s Pro
Rata Share times the amount of such Letter of Credit.


 


(iii)                               If
the Borrower so requests in any applicable Letter of Credit Application, the
L/C Issuer may, in its sole and absolute discretion, agree to issue a Letter of
Credit that has automatic renewal provisions (each, an “Auto-Renewal Letter
of Credit”); provided that any such Auto-Renewal Letter of Credit
must permit the L/C Issuer to prevent any such renewal at least once in each
twelve-month period (commencing with the date of issuance of such Letter of
Credit) by giving prior notice to the beneficiary thereof not later than a day
(the “Nonrenewal Notice Date”) in each such twelve-month period to be
agreed upon at the time such Letter of Credit is issued.  Unless otherwise directed by the L/C Issuer,
the Borrower shall not be required to make a specific request to the L/C Issuer
for any such renewal.  Once an
Auto-Renewal Letter of Credit has been issued, the Lenders shall be deemed to
have authorized (but may not require) the L/C


 


25

















 


Issuer to permit the renewal of such Letter of Credit at any time prior
to an expiry date not later than the Letter of Credit Expiration Date; provided,
however, that the L/C Issuer shall not permit any such renewal if (A)
the L/C Issuer has determined that it would have no obligation at such time to
issue such Letter of Credit in its renewed form under the terms hereof (by
reason of the provisions of Section 2.04(a) or otherwise), or (B)
it has received notice (which may be by telephone or in writing) on or before
the day that is two Business Days before the Nonrenewal Notice Date (1) from
the Administrative Agent that the Required Lenders have elected not to permit
such renewal or (2) from the Administrative Agent, any Lender or the Borrower
that one or more of the applicable conditions specified in Section 4.02
is not then satisfied.


 


(iv)                              Promptly
after its delivery of any Letter of Credit or any amendment to a Letter of
Credit to an advising bank with respect thereto or to the beneficiary thereof,
the L/C Issuer will also deliver to the Borrower and the Administrative Agent a
true and complete copy of such Letter of Credit or amendment.


 


(c)                                  Drawings
and Reimbursements; Funding of Participations.


 


(i)                                     Upon
receipt from the beneficiary of any Letter of Credit of any notice of a drawing
under such Letter of Credit, the L/C Issuer shall notify the Borrower and the
Administrative Agent thereof.  Not later
than 11:00 a.m. on the date of any payment by the L/C Issuer under a Letter of
Credit (each such date, an “Honor Date”), the Borrower shall reimburse
the L/C Issuer through the Administrative Agent in an amount equal to the
amount of such drawing.  If the Borrower
fails to so reimburse the L/C Issuer by such time, the Administrative Agent
shall promptly notify each Lender of the Honor Date, the amount of the
unreimbursed drawing (the “Unreimbursed Amount”), and the amount of such
Lender’s Pro Rata Share thereof.  In
such event, the Borrower shall be deemed to have requested a Committed
Borrowing of Base Rate Loans to be disbursed on the Honor Date in an amount
equal to the Unreimbursed Amount, without regard to the minimum and multiples
specified in Section 2.02 for the principal amount of Base Rate
Loans, but subject to the amount of the unutilized portion of the Aggregate
Commitments and the conditions set forth in Section 4.02 (other
than the delivery of a Loan Notice). 
Any notice given by the L/C Issuer or the Administrative Agent pursuant
to this Section 2.03(c)(i) may be given by telephone if immediately
confirmed in writing; provided that the lack of such an immediate
confirmation shall not affect the conclusiveness or binding effect of such
notice.


 


(ii)                                  Each
Lender (including the Lender acting as L/C Issuer) shall upon any notice
pursuant to Section 2.03(c)(i) make funds available to the
Administrative Agent for the account of the L/C Issuer at the Administrative
Agent’s Office in an amount equal to its Pro Rata Share of the Unreimbursed
Amount not later than 1:00 p.m. on the Business Day specified in such notice by
the Administrative Agent, whereupon, subject to the provisions of Section 2.03(c)(iii),
each Lender that so makes funds available shall be deemed to have made a Base
Rate Loan to the Borrower in such amount. 
The Administrative Agent shall remit the funds so received to the L/C
Issuer.


 


26

















 


(iii)                               With
respect to any Unreimbursed Amount that is not fully refinanced by a Committed
Borrowing of Base Rate Loans because the conditions set forth in Section 4.02
cannot be satisfied or for any other reason, the Borrower shall be deemed to
have incurred from the L/C Issuer an L/C Borrowing in the amount of the
Unreimbursed Amount that is not so refinanced, which L/C Borrowing shall be due
and payable on demand (together with interest) and shall bear interest at the
Default Rate.  In such event, each
Lender’s payment to the Administrative Agent for the account of the L/C Issuer
pursuant to Section 2.03(c)(ii) shall be deemed payment in respect
of its participation in such L/C Borrowing and shall constitute an L/C Advance
from such Lender in satisfaction of its participation obligation under this Section 2.03.


 


(iv)                              Until
each Lender funds its Loan or L/C Advance pursuant to this Section 2.03(c)
to reimburse the L/C Issuer for any amount drawn under any Letter of Credit,
interest in respect of such Lender’s Pro Rata Share of such amount shall be
solely for the account of the L/C Issuer.


 


(v)                                 Each
Lender’s obligation to make Loans or L/C Advances to reimburse the L/C Issuer
for amounts drawn under Letters of Credit, as contemplated by this Section 2.03(c),
shall be absolute and unconditional and shall not be affected by any
circumstance, including (A) any set-off, counterclaim, recoupment, defense or
other right which such Lender may have against the L/C Issuer, the Borrower or
any other Person for any reason whatsoever; (B) the occurrence or continuance
of a Default, or (C) any other occurrence, event or condition, whether or not
similar to any of the foregoing; provided, however, that each
Lender’s obligation to make Loans pursuant to this Section 2.03(c)
is subject to the conditions set forth in Section 4.02 (other than
delivery by the Borrower of a Loan Notice). 
No such making of an L/C Advance shall relieve or otherwise impair the
obligation of the Borrower to reimburse the L/C Issuer for the amount of any
payment made by the L/C Issuer under any Letter of Credit, together with
interest as provided herein.


 


(vi)                              If
any Lender fails to make available to the Administrative Agent for the account
of the L/C Issuer any amount required to be paid by such Lender pursuant to the
foregoing provisions of this Section 2.03(c) by the time specified
in Section 2.03(c)(ii), the L/C Issuer shall be entitled to recover
from such Lender (acting through the Administrative Agent), on demand, such
amount with interest thereon for the period from the date such payment is
required to the date on which such payment is immediately available to the L/C
Issuer at a rate per annum equal to the Federal Funds Rate from time to time in
effect.  A certificate of the L/C Issuer
submitted to any Lender (through the Administrative Agent) with respect to any
amounts owing under this clause (vi) shall be conclusive absent manifest error.


 


(d)                                 Repayment
of Participations.


 


(i)                                     At
any time after the L/C Issuer has made a payment under any Letter of Credit and
has received from any Lender such Lender’s L/C Advance in respect of such
payment in accordance with Section 2.03(c), if the Administrative
Agent receives for the


 


27

















 


account of the L/C Issuer any payment in respect of the related
Unreimbursed Amount or interest thereon (whether directly from the Borrower or
otherwise, including proceeds of Cash Collateral applied thereto by the
Administrative Agent), the Administrative Agent will distribute to such Lender
its Pro Rata Share thereof (appropriately adjusted, in the case of interest
payments, to reflect the period of time during which such Lender’s L/C Advance
was outstanding) in the same funds as those received by the Administrative
Agent.


 


(ii)                                  If
any payment received by the Administrative Agent for the account of the L/C
Issuer pursuant to Section 2.03(c)(i) is required to be returned
under any of the circumstances described in Section 10.06
(including pursuant to any settlement entered into by the L/C Issuer in its
discretion), each Lender shall pay to the Administrative Agent for the account
of the L/C Issuer its Pro Rata Share thereof on demand of the Administrative
Agent, plus interest thereon from the date of such demand to the date such
amount is returned by such Lender, at a rate per annum equal to the Federal
Funds Rate from time to time in effect.


 


(e)                                  Obligations
Absolute.  The obligation of the
Borrower to reimburse the L/C Issuer for each drawing under each Letter of
Credit and to repay each L/C Borrowing shall be absolute, unconditional and
irrevocable, and shall be paid strictly in accordance with the terms of this
Agreement under all circumstances, including the following:


 


(i)                                     any
lack of validity or enforceability of such Letter of Credit, this Agreement, or
any other agreement or instrument relating thereto;


 


(ii)                                  the
existence of any claim, counterclaim, set-off, defense or other right that the
Borrower may have at any time against any beneficiary or any transferee of such
Letter of Credit (or any Person for whom any such beneficiary or any such
transferee may be acting), the L/C Issuer or any other Person, whether in
connection with this Agreement, the transactions contemplated hereby or by such
Letter of Credit or any agreement or instrument relating thereto, or any
unrelated transaction;


 


(iii)                               any
draft, demand, certificate or other document presented under such Letter of
Credit proving to be forged, fraudulent, invalid or insufficient in any respect
or any statement therein being untrue or inaccurate in any respect; or any loss
or delay in the transmission or otherwise of any document required in order to
make a drawing under such Letter of Credit;


 


(iv)                              any
payment by the L/C Issuer under such Letter of Credit against presentation of a
draft or certificate that does not strictly comply with the terms of such
Letter of Credit; or any payment made by the L/C Issuer under such Letter of
Credit to any Person purporting to be a trustee in bankruptcy,
debtor-in-possession, assignee for the benefit of creditors, liquidator,
receiver or other representative of or successor to any beneficiary or any
transferee of such Letter of Credit, including any arising in connection with
any proceeding under any Debtor Relief Law; or


 


28

















 


(v)                                 any
other circumstance or happening whatsoever, whether or not similar to any of
the foregoing, including any other circumstance that might otherwise constitute
a defense available to, or a discharge of, the Borrower.


 


The Borrower shall promptly examine a copy of each Letter of Credit and
each amendment thereto that is delivered to it and, in the event of any claim
of noncompliance with the Borrower’s instructions or other irregularity, the
Borrower will immediately notify the L/C Issuer.  The Borrower shall be conclusively deemed to have waived any such
claim against the L/C Issuer and its correspondents unless such notice is given
as aforesaid.


 


(f)                                    Role
of L/C Issuer.  Each Lender and the
Borrower agree that, in paying any drawing under a Letter of Credit, the L/C
Issuer shall not have any responsibility to obtain any document (other than any
sight draft, certificates and documents expressly required by the Letter of
Credit) or to ascertain or inquire as to the validity or accuracy of any such document
or the authority of the Person executing or delivering any such document.  None of the L/C Issuer, any Agent-Related
Person nor any of the respective correspondents, participants or assignees of
the L/C Issuer shall be liable to any Lender for (i) any action taken or
omitted in connection herewith at the request or with the approval of the
Lenders or the Required Lenders, as applicable; (ii) any action taken or
omitted in the absence of gross negligence or willful misconduct; or (iii) the
due execution, effectiveness, validity or enforceability of any document or
instrument related to any Letter of Credit or Letter of Credit
Application.  The Borrower hereby
assumes all risks of the acts or omissions of any beneficiary or transferee
with respect to its use of any Letter of Credit; provided, however,
that this assumption is not intended to, and shall not, preclude the Borrower’s
pursuing such rights and remedies as it may have against the beneficiary or
transferee at law or under any other agreement.  None of the L/C Issuer, any Agent-Related Person, nor any of the
respective correspondents, participants or assignees of the L/C Issuer, shall
be liable or responsible for any of the matters described in clauses (i)
through (v) of Section 2.03(e); provided, however,
that anything in such clauses to the contrary notwithstanding, the Borrower may
have a claim against the L/C Issuer, and the L/C Issuer may be liable to the
Borrower, to the extent, but only to the extent, of any direct, as opposed to
consequential or exemplary, damages suffered by the Borrower which the Borrower
proves were caused by the L/C Issuer’s willful misconduct or gross negligence
or the L/C Issuer’s willful failure to pay under any Letter of Credit after the
presentation to it by the beneficiary of a sight draft and certificate(s)
strictly complying with the terms and conditions of a Letter of Credit.  In furtherance and not in limitation of the
foregoing, the L/C Issuer may accept documents that appear on their face to be
in order, without responsibility for further investigation, regardless of any
notice or information to the contrary, and the L/C Issuer shall not be
responsible for the validity or sufficiency of any instrument transferring or
assigning or purporting to transfer or assign a Letter of Credit or the rights
or benefits thereunder or proceeds thereof, in whole or in part, which may
prove to be invalid or ineffective for any reason.


 


(g)                                 Cash
Collateral.  Upon the request of the
Administrative Agent, (i) if the L/C Issuer has honored any full or partial
drawing request under any Letter of Credit and such drawing has resulted in an
L/C Borrowing, or (ii) if, as of the Letter of Credit Expiration Date, any
Letter of Credit may for any reason remain outstanding and partially or wholly
undrawn, the Borrower shall immediately Cash Collateralize the then Outstanding
Amount of all L/C


 


29

















 


Obligations (in an amount equal to such Outstanding Amount determined
as of the date of such L/C Borrowing or the Letter of Credit Expiration Date,
as the case may be).  For purposes
hereof, “Cash Collateralize” means to pledge and deposit with or deliver
to the Administrative Agent, for the benefit of the L/C Issuer and the Lenders,
as collateral for the L/C Obligations, cash or deposit account balances
pursuant to documentation in form and substance satisfactory to the
Administrative Agent and the L/C Issuer (which documents are hereby consented
to by the Lenders).  Derivatives of such
term have corresponding meanings.  The
Borrower hereby grants to the Administrative Agent, for the benefit of the L/C
Issuer and the Lenders, a security interest in all such cash, deposit accounts
and all balances therein and all proceeds of the foregoing.  Cash collateral shall be maintained in
blocked, non-interest bearing deposit accounts by Administrative Agent.


 


(h)                                 Applicability
of ISP98 and UCP.  Unless otherwise
expressly agreed by the L/C Issuer and the Borrower when a Letter of Credit is
issued (including any such agreement applicable to an Existing Letter of
Credit), (i) the rules of the “International Standby Practices 1998” published
by the Institute of International Banking Law & Practice (or such later
version thereof as may be in effect at the time of issuance) shall apply to
each standby Letter of Credit, and (ii) the rules of the Uniform Customs and
Practice for Documentary Credits, as most recently published by the
International Chamber of Commerce (the “ICC”) at the time of issuance
(including the ICC decision published by the Commission on Banking Technique
and Practice on April 6, 1998 regarding the European single currency
(euro)) shall apply to each commercial Letter of Credit.


 


(i)                                     Letter
of Credit Fees.  The Borrower shall
pay to the Administrative Agent for the account of each Lender in accordance
with its Pro Rata Share a Letter of Credit fee for each Letter of Credit equal
to the Applicable Rate for Letters of Credit times the daily maximum
amount available to be drawn under such Letter of Credit (whether or not such
maximum amount is then in effect under such Letter of Credit).  Such letter of credit fees shall be computed
on a quarterly basis in arrears.  Such
letter of credit fees shall be due and payable on the first Business Day after
the end of each March, June, September and December, commencing with the
first such date to occur after the issuance of such Letter of Credit, on the
Letter of Credit Expiration Date and thereafter on demand.  If there is any change in the Applicable
Rate during any quarter, the daily maximum amount of each Letter of Credit
shall be computed and multiplied by the Applicable Rate separately for each
period during such quarter that such Applicable Rate was in effect.  Notwithstanding anything to the contrary
contained herein, upon the request of the Required Lenders, while any Event of
Default exists, all Letter of Credit fees shall accrue at the Default Rate.


 


(j)                                     Fronting
Fee and Documentary and Processing Charges Payable to L/C Issuer.  The Borrower shall pay directly to the L/C
Issuer for its own account a fronting fee with respect to each Letter of Credit
at a rate equal to one-eighth of one percent per annum in each case times the
actual daily maximum amount available to be drawn under each Letter of Credit,
which such fee shall be due and payable on the first Business Day of each
March, June, September and December, commencing with the first such date
to occur after the issuance of such Letter of Credit and on the Letter of
Credit Expiration Date.  In addition, the
Borrower shall pay directly to the L/C Issuer for its own account reasonable
customary issuance, presentation, amendment


 


30

















 


and other
processing fees, and other standard costs and charges, of the L/C Issuer
relating to letters of credit as from time to time in effect.  Such reasonable customary fees and standard
costs and charges are due and payable on demand and are nonrefundable.


 


(k)                                  Conflict
with Letter of Credit Application. 
In the event of any conflict between the terms hereof and the terms of
any Letter of Credit Application, the terms hereof shall control.


 


2.04                        Prepayments.


 


(a)                                  The
Borrower may, upon notice to the Administrative Agent, at any time or from time
to time voluntarily prepay Loans in whole or in part without premium or
penalty; provided that (i) such notice must be received by the
Administrative Agent not later than 11:00 a.m. (A) three Business Days prior to
any date of prepayment of Eurodollar Rate Loans and (B) on the date of prepayment
of Base Rate Loans; (ii) any prepayment of Eurodollar Rate Loans shall be in a
principal amount of $5,000,000 or a whole multiple of $1,000,000 in excess
thereof; and (iii) any prepayment of Base Rate Loans shall be in a principal
amount of $250,000 or a whole multiple of $100,000 in excess thereof or, in
each case, if less, the entire principal amount thereof then outstanding.  Each such notice shall specify the date and
amount of such prepayment and the Type(s) of Loans to be prepaid.  The Administrative Agent will promptly
notify each Lender of its receipt of each such notice, and of the amount of
such Lender’s Pro Rata Share of such prepayment.  If such notice is given by the Borrower, the Borrower shall make
such prepayment and the payment amount specified in such notice shall be due
and payable on the date specified therein. 
Any prepayment of a Eurodollar Rate Loan shall be accompanied by all
accrued interest thereon, together with any additional amounts required
pursuant to Section 3.05. 
Each such prepayment shall be applied to the Loans of the Lenders in
accordance with their respective Pro Rata Shares.


 


(b)                                 If
for any reason the Total Outstandings at any time exceed the Aggregate
Commitments then in effect, the Borrower shall immediately prepay Loans and/or
Cash Collateralize the L/C Obligations in an aggregate amount equal to such
excess; provided, however, that the Borrower shall not be
required to Cash Collateralize the L/C Obligations pursuant to this Section 2.04(b)
unless after the prepayment in full of the Loans the Total Outstandings exceed
the Aggregate Commitments then in effect.


 


2.05                        Termination or Reduction of Commitments.  The Borrower may, upon notice to the
Administrative Agent, terminate the Aggregate Commitments, or from time to time
permanently reduce the Aggregate Commitments; provided that (i) any such
notice shall be received by the Administrative Agent not later than 11:00 a.m.
five Business Days prior to the date of termination or reduction, (ii) any such
partial reduction shall be in an aggregate amount of $10,000,000 or any whole
multiple of $1,000,000 in excess thereof, (iii) the Borrower shall not
terminate or reduce the Aggregate Commitments if, after giving effect thereto
and to any concurrent prepayments hereunder, the Total Outstandings would
exceed the Aggregate Commitments, and (iv) if, after giving effect to any
reduction of the Aggregate Commitments, the Letter of Credit Sublimit exceeds
the amount of the Aggregate Commitments, such Sublimit shall be automatically
reduced by the amount of such excess. 
The Administrative Agent will promptly notify the Lenders of any such
notice of termination or reduction of the Aggregate


 


31

















 


Commitments.  Any reduction of
the Aggregate Commitments shall be applied to the Commitment of each Lender
according to its Pro Rata Share.  All
Commitment Fees accrued until the effective date of any termination of the
Aggregate Commitments shall be paid on the effective date of such termination.


 


2.06                        Repayment of Loans. 
The Borrower shall repay to the Lenders on the Maturity Date the
aggregate principal amount of Loans outstanding on such date.


 


2.07                        Interest.


 


(a)                                  Subject
to the provisions of subsection (b) below, (i) each Eurodollar Rate Loan
shall bear interest on the outstanding principal amount thereof for each
Interest Period at a rate per annum equal to the Eurodollar Rate for such
Interest Period plus the Applicable Rate for Eurodollar Loans and (ii)
each Base Rate Loan shall bear interest on the outstanding principal amount
thereof from the applicable borrowing date at a rate per annum equal to the
Base Rate plus the Applicable Rate for Base Rate Loans.


 


(b)                                 If
any amount payable by the Borrower under any Loan Document is not paid when due
(without regard to any applicable grace periods), whether at stated maturity,
by acceleration or otherwise, such amount shall thereafter bear interest at a
fluctuating interest rate per annum at all times equal to the Default Rate to
the fullest extent permitted by applicable Laws.  Furthermore,  while
any Event of Default exists, the Borrower shall pay interest on the principal
amount of all outstanding Obligations hereunder at a fluctuating interest rate
per annum at all times equal to the Default Rate to the fullest extent
permitted by applicable Laws.  Accrued
and unpaid interest on past due amounts (including interest on past due
interest) shall be due and payable upon demand.


 


(c)                                  Interest
on each Loan shall be due and payable in arrears on each Interest Payment Date
applicable thereto and at such other times as may be specified herein.  Interest hereunder shall be due and payable
in accordance with the terms hereof before and after judgment, and before and
after the commencement of any proceeding under any Debtor Relief Law.


 


2.08                        Fees.  In addition to certain fees described in
subsections (i) and (j) of Section 2.03:


 


(a)                                  Commitment
Fee.  The Borrower shall pay to the
Administrative Agent for the account of each Lender in accordance with its Pro
Rata Share, a commitment fee (the “Commitment Fee”) equal to the Applicable
Rate for the Commitment Fee times the actual daily amount by which the
Aggregate Commitments exceed the sum of (i) the Outstanding Amount of Loans and
(ii) the Outstanding Amount of L/C Obligations.  The Commitment Fee shall accrue at all times during the
Availability Period, including at any time during which one or more of the
conditions in Article IV is not met, and shall be due and payable
quarterly in arrears on the last Business Day of each March, June,
September and December, commencing with the first such date to occur after
the Closing Date, and on the Maturity Date. 
The Commitment Fee shall be calculated quarterly in arrears, and if
there is any change in the Applicable Rate for the


 


32

















 


Commitment Fee
during any quarter, the actual daily amount shall be computed and multiplied by
the Applicable Rate for the Commitment Fee separately for each period during
such quarter that such Applicable Rate for the Commitment Fee was in effect.


 


(b)                                 Other
Fees.  The Borrower shall pay to the
Arranger and the Administrative Agent for their own respective accounts fees in
the amounts and at the times specified in the Fee Letter.  Such fees shall be fully earned when paid
and shall not be refundable for any reason whatsoever.


 


2.09                        Computation of Interest and Fees.  All computations of interest for Base Rate
Loans when the Base Rate is determined by Bank of America’s “prime rate” shall
be made on the basis of a year of 365 or 366 days, as the case may be, and
actual days elapsed.  All other
computations of fees and interest shall be made on the basis of a 360-day year
and actual days elapsed (which results in more fees or interest, as applicable,
being paid than if computed on the basis of a 365-day year).  Interest shall accrue on each Loan for the
day on which the Loan is made, and shall not accrue on a Loan, or any portion
thereof, for the day on which the Loan or such portion is paid, provided
that any Loan that is repaid on the same day on which it is made shall, subject
to Section 2.13(a), bear interest for one day.


 


2.10                        Evidence of Debt.


 


(a)                                  The
Credit Extensions made by each Lender shall be evidenced by one or more
accounts or records maintained by such Lender and by the Administrative Agent
in the ordinary course of business.  The
accounts or records maintained by the Administrative Agent and each Lender
shall be conclusive absent manifest error of the amount of the Credit
Extensions made by the Lenders to the Borrower and the interest and payments
thereon.  Any failure to so record or
any error in doing so shall not, however, limit or otherwise affect the
obligation of the Borrower hereunder to pay any amount owing with respect to
the Obligations.  In the event of any
conflict between the accounts and records maintained by any Lender and the
accounts and records of the Administrative Agent in respect of such matters,
the accounts and records of the Administrative Agent shall control in the
absence of manifest error.  Upon the
request of any Lender made through the Administrative Agent, the Borrower shall
execute and deliver to such Lender (through the Administrative Agent) a Note,
which shall evidence such Lender’s Loans in addition to such accounts or
records.  Each Lender may attach
schedules to its Note and endorse thereon the date, Type (if applicable),
amount and maturity of its Loans and payments with respect thereto.


 


(b)                                 In
addition to the accounts and records referred to in subsection (a), each
Lender and the Administrative Agent shall maintain in accordance with its usual
practice accounts or records evidencing the purchases and sales by such Lender
of participations in Letters of Credit. 
In the event of any conflict between the accounts and records maintained
by the Administrative Agent and the accounts and records of any Lender in
respect of such matters, the accounts and records of the Administrative Agent
shall control in the absence of manifest error.


 


33

















 


2.11                        Payments Generally.


 


(a)                                  All
payments to be made by the Borrower shall be made without condition or
deduction for any counterclaim, defense, recoupment or setoff.  Except as otherwise expressly provided
herein, all payments by the Borrower hereunder shall be made to the
Administrative Agent, for the account of the respective Lenders to which such
payment is owed, at the Administrative Agent’s Office in Dollars and in
immediately available funds not later than 2:00 p.m. on the date specified
herein.  The Administrative Agent will
promptly distribute to each Lender its Pro Rata Share (or other applicable
share as provided herein) of such payment in like funds as received by wire
transfer to such Lender’s Lending Office. 
All payments received by the Administrative Agent after 2:00 p.m. shall
be deemed received on the next succeeding Business Day and any applicable
interest or fee shall continue to accrue.


 


(b)                                 If
any payment to be made by the Borrower shall come due on a day other than a
Business Day, payment shall be made on the next following Business Day, and
such extension of time shall be reflected in computing interest or fees, as the
case may be.


 


(c)                                  Unless
the Borrower or any Lender has notified the Administrative Agent, prior to the
date any payment is required to be made by it to the Administrative Agent
hereunder, that the Borrower or such Lender, as the case may be, will not make
such payment, the Administrative Agent may assume that the Borrower or such
Lender, as the case may be, has timely made such payment and may (but shall not
be so required to), in reliance thereon, make available a corresponding amount
to the Person entitled thereto.  If and
to the extent that such payment was not in fact made to the Administrative
Agent in immediately available funds, then:


 


(i)                                     if
the Borrower failed to make such payment, each Lender shall forthwith on demand
repay to the Administrative Agent the portion of such assumed payment that was
made available to such Lender in immediately available funds, together with
interest thereon in respect of each day from and including the date such amount
was made available by the Administrative Agent to such Lender to the date such
amount is repaid to the Administrative Agent in immediately available funds at
the Federal Funds Rate from time to time in effect; and


 


(ii)                                  if
any Lender failed to make such payment, such Lender shall forthwith on demand
pay to the Administrative Agent the amount thereof in immediately available
funds, together with interest thereon for the period from the date such amount
was made available by the Administrative Agent to the Borrower to the date such
amount is recovered by the Administrative Agent (the “Compensation Period”)
at a rate per annum equal to the Federal Funds Rate from time to time in
effect.  If such Lender pays such amount
to the Administrative Agent, then such amount shall constitute such Lender’s
Loan included in the applicable Borrowing. 
If such Lender does not pay such amount forthwith upon the
Administrative Agent’s demand therefor, the Administrative Agent may make a
demand therefor upon the Borrower, and the Borrower shall pay such amount to
the Administrative Agent, together with interest thereon for the Compensation
Period at a rate per annum equal to the rate of interest applicable to the
applicable Borrowing.  Nothing herein
shall be deemed to relieve any Lender from its obligation to


 


34

















 


fulfill its Commitment or to prejudice any rights which the
Administrative Agent or the Borrower may have against any Lender as a result of
any default by such Lender hereunder.


 


A notice of the Administrative Agent to any Lender or the Borrower with
respect to any amount owing under this subsection (c) shall be conclusive,
absent manifest error.


 


(d)                                 If
any Lender makes available to the Administrative Agent funds for any Loan to be
made by such Lender as provided in the foregoing provisions of this Article II,
and such funds are not made available to the Borrower by the Administrative
Agent because the conditions to the applicable Credit Extension set forth in Article IV
are not satisfied or waived in accordance with the terms hereof, the
Administrative Agent shall return such funds (in like funds as received from
such Lender) to such Lender, without interest.


 


(e)                                  The
obligations of the Lenders hereunder to make Loans and to fund participations
in Letters of Credit are several and not joint.  The failure of any Lender to make any Loan or to fund any such
participation on any date required hereunder shall not relieve any other Lender
of its corresponding obligation to do so on such date, and no Lender shall be
responsible for the failure of any other Lender to so make its Loan or purchase
its participation.


 


(f)                                    Nothing
herein shall be deemed to obligate any Lender to obtain the funds for any Loan
in any particular place or manner or to constitute a representation by any
Lender that it has obtained or will obtain the funds for any Loan in any
particular place or manner.


 


2.12                        Sharing of Payments. 
If, other than as expressly provided elsewhere herein, any Lender shall
obtain on account of the Loans made by it, or the participations in L/C
Obligations held by it, any payment (whether voluntary, involuntary, through
the exercise of any right of set-off, or otherwise) in excess of its ratable
share (or other share contemplated hereunder) thereof, such Lender shall
immediately (a) notify the Administrative Agent of such fact, and (b) purchase
from the other Lenders such participations in the Loans made by them and/or
such subparticipations in the participations in L/C Obligations held by them,
as the case may be, as shall be necessary to cause such purchasing Lender to
share the excess payment in respect of such Loans or such participations, as
the case may be, pro rata with each of them; provided, however,
that if all or any portion of such excess payment is thereafter recovered from
the purchasing Lender under any of the circumstances described in Section 10.06
(including pursuant to any settlement entered into by the purchasing Lender in
its discretion), such purchase shall to that extent be rescinded and each other
Lender shall repay to the purchasing Lender the purchase price paid therefor,
together with an amount equal to such paying Lender’s ratable share (according
to the proportion of (i) the amount of such paying Lender’s required repayment
to (ii) the total amount so recovered from the purchasing Lender) of any
interest or other amount paid or payable by the purchasing Lender in respect of
the total amount so recovered, without further interest thereon.  The Borrower agrees that any Lender so
purchasing a participation from another Lender may, to the fullest extent permitted
by law, exercise all its rights of payment (including the right of set-off, but
subject to Section 10.10) with respect to such participation as
fully as if such Lender were the direct creditor of the Borrower in the amount
of such participation.  The
Administrative Agent will keep records (which shall be conclusive and


 


35

















 


binding in the absence of manifest error) of participations purchased
under this Section and will in each case notify the Lenders following any
such purchases or repayments.  Each
Lender that purchases a participation pursuant to this Section shall from
and after such purchase have the right to give all notices, requests, demands,
directions and other communications under this Agreement with respect to the
portion of the Obligations purchased to the same extent as though the
purchasing Lender were the original owner of the Obligations purchased.


 


2.13                        Increase in Commitments.


 


(a)                                  Provided
there exists no Default, upon notice to the Administrative Agent (which shall
promptly notify the Lenders), the Borrower may from time to time, request an
increase in the Aggregate Commitments by an amount (for all such requests) not
exceeding $100,000,000; provided that each such increase shall be in an amount
at least equal to $10,000,000.  At the
time of sending such notice, the Borrower (in consultation with the
Administrative Agent) shall specify the time period within which each Lender is
requested to respond (which shall in no event be less than ten Business Days
from the date of delivery of such notice to the Lenders).  Each Lender shall notify the Administrative
Agent within such time period whether or not it agrees to increase its
Commitment and, if so, whether by an amount equal to, greater than, or less
than its Pro Rata Share of such requested increase.  Any Lender not responding within such time period shall be deemed
to have declined to increase its Commitment. 
The Administrative Agent shall notify the Borrower and each Lender of
the Lenders’ responses to each request made hereunder.  To achieve the full amount of a requested
increase, the Borrower may also invite additional Eligible Assignees to become
Lenders pursuant to a joinder agreement in form and substance satisfactory to
the Borrower, the Administrative Agent and its counsel.


 


(b)                                 If
the Aggregate Commitments are increased in accordance with this Section, the
Administrative Agent and the Borrower shall determine the effective date (the “Increase
Effective Date”) and the final allocation of such increase.  The Administrative Agent shall promptly
notify the Borrower and the Lenders of the final allocation of such increase
and the Increase Effective Date.  As a
condition precedent to such increase, the Borrower shall deliver to the Administrative
Agent a certificate of each Loan Party dated as of the Increase Effective Date
(in sufficient copies for each Lender) signed by a Responsible Officer of such
Loan Party (i) certifying and attaching the resolutions adopted by such Loan
Party approving or consenting to such increase, and (ii) in the case of the
Borrower, certifying that, before and after giving effect to such increase, (A)
the representations and warranties contained in Article V and the
other Loan Documents are true and correct on and as of the Extension Effective
Date, except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they are true and correct
as of such earlier date, and except that for purposes of this Section 2.13,
the representations and warranties contained in subsections (a) and (b) of Section 5.05
shall be deemed to refer to the most recent statements furnished pursuant to
subsections (a) and (b), respectively, of Section 6.01, and (B) no
Default exists.  The Borrower shall
prepay any Loans outstanding on the Increase Effective Date (and pay any
additional amounts required pursuant to Section 3.05) to the extent
necessary to keep the outstanding Loans ratable with any revised Pro Rata
Shares arising from any nonratable increase in the Commitments under this
Section.


 


36

















 


(c)                                  This
Section shall supersede any provisions in Section 10.01 to the
contrary.


 


ARTICLE III.

TAXES, YIELD PROTECTION AND ILLEGALITY


 


3.01                        Taxes.


 


(a)                                  Any
and all payments by the Borrower to or for the account of the Administrative
Agent or any Lender under any Loan Document shall be made free and clear of and
without deduction for any and all present or future taxes, duties, levies,
imposts, deductions, assessments, fees, withholdings or similar charges, and
all liabilities with respect thereto, excluding, in the case of the
Administrative Agent and each Lender, taxes imposed on or measured by its
overall net income, and franchise taxes imposed on it (in lieu of net income
taxes), by the jurisdiction (or any political subdivision thereof) under the
Laws of which the Administrative Agent or such Lender, as the case may be, is
organized or maintains a lending office (all such non-excluded taxes, duties,
levies, imposts, deductions, assessments, fees, withholdings or similar
charges, and liabilities being hereinafter referred to as “Taxes”).  If the Borrower shall be required by any
Laws to deduct any Taxes from or in respect of any sum payable under any Loan
Document to the Administrative Agent or any Lender, (i) the sum payable shall
be increased as necessary so that after making all required deductions
(including deductions applicable to additional sums payable under this
Section), each of the Administrative Agent and such Lender receives an amount
equal to the sum it would have received had no such deductions been made, (ii)
the Borrower shall make such deductions, (iii) the Borrower shall pay the full
amount deducted to the relevant taxation authority or other authority in
accordance with applicable Laws, and (iv) within 30 days after the date of such
payment, the Borrower shall furnish to the Administrative Agent (which shall
forward the same to such Lender) the original or a certified copy of a receipt
evidencing payment thereof.


 


(b)                                 In
addition, the Borrower agrees to pay any and all present or future stamp, court
or documentary taxes and any other excise or property taxes or charges or
similar levies which arise from any payment made under any Loan Document or
from the execution, delivery, performance, enforcement or registration of, or
otherwise with respect to, any Loan Document (hereinafter referred to as “Other
Taxes”).


 


(c)                                  If
the Borrower shall be required to deduct or pay any Taxes or Other Taxes from
or in respect of any sum payable under any Loan Document to the Administrative
Agent or any Lender, the Borrower shall also pay to the Administrative Agent or
to such Lender, as the case may be, at the time interest is paid, such
additional amount that the Administrative Agent or such Lender specifies is
necessary to preserve the after-tax yield (after factoring in all taxes,
including taxes imposed on or measured by net income) that the Administrative
Agent or such Lender would have received if such Taxes or Other Taxes had not
been imposed.


 


(d)                                 The
Borrower agrees to indemnify the Administrative Agent and each Lender for (i)
the full amount of Taxes and Other Taxes (including any Taxes or Other Taxes
imposed or asserted by any jurisdiction on amounts payable under this Section)
paid by the Administrative


 


37

















 


Agent and such
Lender, (ii) amounts payable under Section 3.01(c) and (iii) any
liability (including additions to tax, penalties, interest and expenses)
arising therefrom or with respect thereto, in each case whether or not such
Taxes or Other Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority. 
Payment under this subsection (d) shall be made within 30 days
after the date the Lender or the Administrative Agent makes a demand therefor.


 


3.02                        Illegality.  If any Law has made it unlawful, or any
Governmental Authority has asserted that it is unlawful, for any Lender or its
applicable Lending Office to make, maintain or fund Eurodollar Rate Loans, or
to determine or charge interest rates based upon the Eurodollar Rate, or any
Governmental Authority has imposed material restrictions on the authority of
such Lender to purchase or sell, or to take deposits of, Dollars in the London
InterBank Market, then, on notice thereof by such Lender to the Borrower
through the Administrative Agent, any obligation of such Lender to make or
continue Eurodollar Rate Loans or to convert Base Rate Loans to Eurodollar Rate
Loans shall be suspended until such Lender notifies the Administrative Agent
and the Borrower that the circumstances giving rise to such determination no
longer exist.  Upon receipt of such
notice, the Borrower shall, upon demand from such Lender (with a copy to the
Administrative Agent), prepay or, if applicable, convert all Eurodollar Rate
Loans of such Lender to Base Rate Loans, either on the last day of the Interest
Period therefor, if such Lender may lawfully continue to maintain such
Eurodollar Rate Loans to such day, or immediately, if such Lender may not
lawfully continue to maintain such Eurodollar Rate Loans.  Upon any such prepayment or conversion, the
Borrower shall also pay accrued interest on the amount so prepaid or converted.  Each Lender agrees to designate a different
Lending Office if such designation will avoid the need for such notice and will
not, in the good faith judgment of such Lender, otherwise be materially
disadvantageous to such Lender.


 


3.03                        Inability to Determine Rates.  If the Required Lenders determine that for
any reason in connection with any request for a Eurodollar Rate Loan or a
conversion to or continuation thereof that (a) Dollar deposits are not being
offered to banks in the London interbank eurodollar market for the applicable
amount and Interest Period of such Eurodollar Rate Loan, (b) adequate and
reasonable means do not exist for determining the Eurodollar Rate for any
requested Interest Period with respect to a proposed Eurodollar Rate Loan, or
(c) the Eurodollar Rate for any requested Interest Period with respect to a
proposed Eurodollar Rate Loan does not adequately and fairly reflect the cost
to such Lenders of funding such Loan, the Administrative Agent will promptly so
notify the Borrower and each Lender. 
Thereafter, the obligation of the Lenders to make or maintain Eurodollar
Rate Loans shall be suspended until the Administrative Agent (upon the
instruction of the Required Lenders) revokes such notice.  Upon receipt of such notice, the Borrower
may revoke any pending request for a Borrowing of, conversion to or
continuation of Eurodollar Rate Loans or, failing that, will be deemed to have
converted such request into a request for a Committed Borrowing of Base Rate
Loans in the amount specified therein.


 


38

















 


3.04                        Increased Cost and Reduced Return; Capital Adequacy;
Reserves on Eurodollar Rate Loans.


 


(a)                                  If
any Lender determines that as a result of the introduction of or any change in
or in the interpretation of any Law, or such Lender’s compliance therewith, there
shall be any increase in the cost to such Lender of agreeing to make or making,
funding or maintaining Eurodollar Rate Loans or (as the case may be) issuing or
participating in Letters of Credit, or a reduction in the amount received or
receivable by such Lender in connection with any of the foregoing (excluding
for purposes of this subsection (a) any such increased costs or reduction
in amount resulting from (i) Taxes or Other Taxes (as to which Section 3.01
shall govern), (ii) changes in the basis of taxation of overall net income or
overall gross income by the United States or any foreign jurisdiction or any
political subdivision of either thereof under the Laws of which such Lender is
organized or has its Lending Office, and (iii) reserve requirements
contemplated by Section 3.04(c), then from time to time upon demand
of such Lender (with a copy of such demand to the Administrative Agent), the
Borrower shall pay to such Lender such additional amounts as will compensate
such Lender for such increased cost or reduction.


 


(b)                                 If
any Lender determines that the introduction of any Law regarding capital
adequacy or any change therein or in the interpretation thereof, or compliance
by such Lender (or its Lending Office) therewith, has the effect of reducing the
rate of return on the capital of such Lender or any corporation controlling
such Lender as a consequence of such Lender’s obligations hereunder (taking
into consideration its policies with respect to capital adequacy and such
Lender’s desired return on capital), then from time to time upon demand of such
Lender (with a copy of such demand to the Administrative Agent), the Borrower
shall pay to such Lender such additional amounts as will compensate such Lender
for such reduction.


 


(c)                                  The
Borrower shall pay to each Lender, as long as such Lender shall be required to
maintain reserves with respect to liabilities or assets consisting of or
including Eurocurrency funds or deposits (currently known as “Eurocurrency
liabilities”), additional interest on the unpaid principal amount of each
Eurodollar Rate Loan equal to the actual costs of such reserves allocated to
such Loan by such Lender (as determined by such Lender in good faith, which
determination shall be conclusive), which shall be due and payable on each date
on which interest is payable on such Loan, provided the Borrower shall
have received at least 15 days’ prior notice (with a copy to the Administrative
Agent) of such additional interest from such Lender.  If a Lender fails to give notice 15 days prior to the relevant
Interest Payment Date, such additional interest shall be due and payable 15
days from receipt of such notice.


 


3.05                        Funding Losses.  Upon demand of any Lender (with a copy to
the Administrative Agent) from time to time, the Borrower shall promptly
compensate such Lender for and hold such Lender harmless from any loss, cost or
expense incurred by it as a result of:


 


(a)                                  any
continuation, conversion, payment or prepayment of any Loan other than a Base
Rate Loan on a day other than the last day of the Interest Period for such Loan
(whether voluntary, mandatory, automatic, by reason of acceleration, or
otherwise); or


 


39

















 


(b)                                 any
failure by the Borrower (for a reason other than the failure of such Lender to
make a Loan) to prepay, borrow, continue or convert any Loan other than a Base
Rate Loan on the date or in the amount notified by the Borrower; or


 


(c)                                  any
assignment of a Eurodollar Rate Loan on a day other than the last day of the
Interest Period therefor as a result of a request by the Borrower pursuant to Section 10.17;
including any loss of anticipated profits and any loss or expense arising from
the liquidation or reemployment of funds obtained by it to maintain such Loan
or from fees payable to terminate the deposits from which such funds were
obtained.  The Borrower shall also pay
any reasonable customary administrative fees charged by such Lender in
connection with the foregoing.


 


For purposes of calculating amounts payable by the Borrower to the
Lenders under this Section 3.05, each Lender shall be deemed to
have funded each Eurodollar Rate Loan made by it at the Eurodollar Rate for
such Loan by a matching deposit or other borrowing in the London interbank
eurodollar market for a comparable amount and for a comparable period, whether
or not such Eurodollar Rate Loan was in fact so funded.


 


3.06                        Matters Applicable to all Requests for Compensation.


 


(a)                                  A
certificate of the Administrative Agent or any Lender claiming compensation
under this Article III and setting forth the additional amount or
amounts to be paid to it hereunder shall be conclusive in the absence of
manifest error.  In determining such
amount, the Administrative Agent or such Lender may use any reasonable
averaging and attribution methods.


 


(b)                                 Upon
any Lender’s making a claim for compensation under Section 3.01 or 3.04,
the Borrower may replace such Lender in accordance with Section 10.17.


 


3.07                        Survival.  All of the Borrower’s obligations under this
Article III shall survive termination of the Aggregate Commitments
and repayment of all other Obligations hereunder.


 


For purposes of this Article III only, the term “Laws”
shall include any and all guidelines of any Governmental Authority and the
interpretation or administration of the Laws by any Governmental Authority
charged with the enforcement, interpretation or administration thereof.


 


ARTICLE IV.

CONDITIONS PRECEDENT TO CREDIT EXTENSIONS


 


4.01                        Conditions of Initial Credit Extension.  The obligation of each Lender to make its
initial Credit Extension hereunder is subject to satisfaction of the following
conditions precedent:


 


(a)                                  The
Administrative Agent’s receipt of the following, each of which shall be
originals or facsimiles (followed promptly by originals) unless otherwise
specified, each properly executed by a Responsible Officer of the signing Loan
Party, each dated the Closing Date (or, in the case of certificates of
governmental officials, a recent date before the Closing Date) and each in form
and substance satisfactory to the Administrative Agent and each of the Lenders:


 


40

















 


(i)                                     executed
counterparts of this Agreement, the Guaranty, and the Stock Pledge and the
Intercreditor Agreement sufficient in number for distribution to the
Administrative Agent, each Lender and the Borrower;


 


(ii)                                  a
Note executed by the Borrower in favor of each Lender requesting a Note;


 


(iii)                               such
certificates of resolutions or other action, incumbency certificates and/or
other certificates of Responsible Officers of each Loan Party as the
Administrative Agent may require evidencing the identity, authority and
capacity of each Responsible Officer thereof authorized to act as a Responsible
Officer in connection with this Agreement and the other Loan Documents to which
such Loan Party is a party;


 


(iv)                              such
documents and certifications as the Administrative Agent may reasonably require
to evidence that each Loan Party is duly organized or formed, and that each of
the Borrower and the Guarantors is validly existing, in good standing and
qualified to engage in business in each jurisdiction where its ownership, lease
or operation of properties or the conduct of its business requires such
qualification, except to the extent that failure to do so could not reasonably
be expected to have a Material Adverse Effect;


 


(v)                                 a
favorable opinion of John Walter, general counsel to the Loan Parties,
addressed to the Administrative Agent and each Lender, as to the matters set
forth in Exhibit F;


 


(vi)                              a
favorable opinion of Thompson & Knight L.L.P., counsel to Administrative
Agent, addressed to the Administrative Agent and each Lender, as to the
enforceability of the Credit Agreement, the Notes and the Guaranty under Texas
law;


 


(vii)                           a
certificate of a Responsible Officer of each Loan Party either (A) attaching
copies of all consents, licenses and approvals required in connection with the
execution, delivery and performance by such Loan Party and the validity against
such Loan Party of the Loan Documents to which it is a party, and such
consents, licenses and approvals shall be in full force and effect, or (B)
stating that no such consents, licenses or approvals are so required;


 


(viii)                        a
certificate signed by a Responsible Officer of the Borrower certifying (A) that
the conditions specified in Sections 4.02(a) and (b) have been
satisfied, and (B) that there has been no event or circumstance since the date
of the Initial Financial Statements that has had or could be reasonably
expected to have, either individually or in the aggregate, a Material Adverse
Effect; and (C) the calculation of the Debt to Capitalization Ratio as of
March 31, 2004;


 


(ix)                                evidence
that all insurance required to be maintained pursuant to the Loan Documents has
been obtained and is in effect;


 


41

















 


(x)                                   a
budget of Borrower and its Consolidated Subsidiaries for the fiscal year 2004,
prepared by the Financial Planning Department of the Borrower and approved by
the Board of Directors of the Borrower;


 


(xi)                                projections
of Borrower and its Consolidated Subsidiaries for the fiscal years 2004 through
2008, prepared by the Financial Planning Department of Borrower and reviewed by
the Chief Financial Officer of Borrower;


 


(xii)                             such
other assurances, certificates, documents, consents or opinions as the
Administrative Agent, the L/C Issuer or the Required Lenders reasonably may
require;


 


(xiii)                          Letter
Amendment No. 2 to Third Amended and Restated Master Shelf Agreement shall have
been executed by all parties thereto, a final copy and execution pages thereof
shall have been delivered to Administrative Agent, and such Letter Amendment
shall be in form and substance satisfactory to Administrative Agent and in full
force and effect.


 


(b)                                 Any
fees required to be paid on or before the Closing Date shall have been paid.


 


(c)                                  The
Indebtedness under the Existing Credit agreement shall be refinanced with
proceeds of the initial Credit Extension.


 


(d)                                 Unless
waived by the Administrative Agent, the Borrower shall have paid all Attorney
Costs of the Administrative Agent to the extent invoiced prior to or on the
Closing Date, plus such additional amounts of Attorney Costs as shall
constitute its reasonable estimate of Attorney Costs incurred or to be incurred
by it through the closing proceedings (provided that such estimate shall not
thereafter preclude a final settling of accounts between the Borrower and the
Administrative Agent).


 


4.02                        Conditions to all Credit Extensions.  The obligation of each Lender to honor any
Request for Credit Extension (other than a Loan Notice requesting only a
conversion of Loans to the other Type, or a continuation of Eurodollar Rate
Loans) is subject to the following conditions precedent:


 


(a)                                  The
representations and warranties of the Borrower and each other Loan Party
contained in Article V or any other Loan Document, or which are
contained in any document furnished at any time under or in connection herewith
or therewith, shall be true and correct on and as of the date of such Credit
Extension, except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they shall be true and
correct as of such earlier date, and except that for purposes of this Section 4.02,
the representations and warranties contained in subsections (a) and (b) of Section 5.05
shall be deemed to refer to the most recent statements furnished pursuant to
clauses (a) and (b), respectively, of Section 6.01.


 


(b)                                 No
Default shall exist, or would result from such proposed Credit Extension.


 


(c)                                  The
Administrative Agent and, if applicable, the L/C Issuer shall have received a
Request for Credit Extension in accordance with the requirements hereof.


 


42

















 


Each Request for Credit Extension (other than a Loan Notice requesting
only a conversion of Loans to the other Type or a continuation of Eurodollar
Rate Loans) submitted by the Borrower shall be deemed to be a representation
and warranty that the conditions specified in Sections 4.02(a) and (b)
have been satisfied on and as of the date of the applicable Credit Extension.


 


ARTICLE V.

REPRESENTATIONS AND WARRANTIES


 


The Borrower represents and warrants to the Administrative Agent and
the Lenders that:


 


5.01                        Existence, Qualification and Power; Compliance with Laws.  Each Loan Party (a) is a corporation,
partnership or limited liability company duly organized or formed, validly
existing and in good standing under the Laws of the jurisdiction of its
incorporation or organization, (b) has all requisite power and authority and
all requisite governmental licenses, authorizations, consents and approvals to
(i) own its assets and carry on its business and (ii) execute, deliver and
perform its obligations under the Loan Documents to which it is a party, (c) is
duly qualified and is licensed and in good standing under the Laws of each
jurisdiction where its ownership, lease or operation of properties or the
conduct of its business requires such qualification or license, and (d) is in
compliance with all Laws; except in each case referred to in clause (b)(i), (c)
or (d), to the extent that failure to do so could not reasonably be expected to
have a Material Adverse Effect.


 


5.02                        Authorization; No Contravention.  The execution, delivery and performance by
each Loan Party of each Loan Document to which such Person is party, have been
duly authorized by all necessary corporate or other organizational action, and
do not and will not (a) contravene the terms of any of such Person’s
Organization Documents; (b) conflict with or result in any breach or
contravention of, in any material respect, or the creation of any Lien under,
(i) any Contractual Obligation to which such Person is a party or (ii) any
order, injunction, writ or decree of any Governmental Authority or any arbitral
award to which such Person or its property is subject; or (c) violate any Law;
except, with respect to clause (b) or (c), as could not reasonably be expected
to have a Material Adverse Effect.


 


5.03                        Governmental Authorization; Other Consents.  No approval, consent, exemption,
authorization, or other action by, or notice to, or filing with, any
Governmental Authority or any other Person (other than the consent of Wyoming
Public Service Commission regarding the Guaranty of MGTC) is necessary or required
in connection with the execution, delivery or performance by, or enforcement
against, any Loan Party of this Agreement or any other Loan Document.


 


5.04                        Binding Effect.  This Agreement has been, and each other Loan
Document, when delivered hereunder, will have been, duly executed and delivered
by each Loan Party that is party thereto. 
This Agreement constitutes, and each other Loan Document when so
delivered will constitute, a legal, valid and binding obligation of such Loan
Party, enforceable against each Loan Party that is party thereto in accordance
with its terms; except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar Laws


 


43

















 


affecting the enforcement of creditors’ rights generally and by general
equitable principles (whether enforcement is sought by proceedings in equity or
at Law).


 


5.05                        Financial Statements; No Material Adverse Effect.


 


(a)                                  The
Audited Financial Statements (i) were prepared in accordance with GAAP
consistently applied throughout the period covered thereby, except as otherwise
expressly noted therein; (ii) fairly present the financial condition of the
Borrower and its Subsidiaries as of the date thereof and their results of
operations for the period covered thereby in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly
noted therein; and (iii) show all material indebtedness and other material
liabilities, direct or contingent, of the Borrower and its Subsidiaries as of
the date thereof, including material liabilities for taxes, material
commitments and material Indebtedness.


 


(b)                                 Each
of the Initial Financial Statements (i) were prepared in accordance with GAAP consistently
applied throughout the period covered thereby, except as otherwise expressly
noted therein, and (ii) fairly present the financial condition of the Borrower
and its Subsidiaries as of the date thereof and their results of operations for
the period covered thereby.  Schedule 5.05 (as hereafter
supplemented from time to time in writing) sets forth all material indebtedness
and other material liabilities, direct or contingent, of the Borrower and its
consolidated Subsidiaries as of the date of the Initial Financial Statements
(but not disclosed therein), including material liabilities for taxes, material
commitments and material Indebtedness.


 


(c)                                  Since
the date of the Initial Financial Statements, there has been no event or
circumstance, either individually or in the aggregate, that has had or could
reasonably be expected to have a Material Adverse Effect.


 


5.06                        Litigation.  Except as disclosed in the Borrower’s most
recent Annual Report filed on Form 10-K with the SEC or the Borrower’s most
recent Quarterly Report filed on Form 10-Q with the SEC, there are no actions,
suits, proceedings, claims or disputes pending or, to the knowledge of the
Responsible Officers after due and diligent investigation, threatened or
contemplated, at law, in equity, in arbitration or before any Governmental
Authority, by or against the Borrower or any of its Subsidiaries or against any
of their properties or revenues that (a) purport to affect or pertain to this
Agreement or any other Loan Document, or any of the transactions contemplated
hereby, or (b) either individually or in the aggregate, if determined
adversely, could reasonably be expected to have a Material Adverse Effect.


 


5.07                        No Default.  Neither the Borrower nor any Subsidiary is
in default under or with respect to any Contractual Obligation that could,
either individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.  No Default has
occurred and is continuing or would result from the consummation of the
transactions contemplated by this Agreement or any other Loan Document.


 


5.08                        Ownership of Property; Liens.  Each of Borrower and each Subsidiary has
good and defensible title to all of its material properties and assets, free
and clear of any Liens other than Permitted Liens and of all impediments to the
use of such properties and assets in such


 


44

















 


Person’s business, except that (i) with regard to easements and
rights-of-way relating to any such Person’s gathering systems, to the best of
such Person’s knowledge, there exist no Liens that a reasonable and prudent
operator in the gas processing business would consider to be a material
impairment of title and such Person has such title as is reasonably necessary
to permit the use and enjoyment of such gathering systems, and (ii) no
representation or warranty is made with respect to any oil, gas or mineral
property or interest to which no proved oil or gas reserves are properly
attributed.


 


5.09                        Environmental Compliance.  The Borrower and its Subsidiaries conduct in the ordinary course
of business a review of the effect of existing Environmental Laws and claims
alleging potential liability or responsibility for violation of any
Environmental Law on their respective businesses, operations and properties,
and as a result thereof the Borrower has reasonably concluded that, except as
disclosed in the Borrower’s most recent Annual Report filed on Form 10-K with
the SEC or the Borrower’s most recent Quarterly Report filed on Form 10-Q with
the SEC, there are no such Environmental Laws and claims could not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect.


 


5.10                        Insurance.  The properties of the Borrower and its
Subsidiaries are insured with financially sound and reputable insurance
companies not Affiliates of the Borrower, in such amounts, with such
deductibles and covering such risks as are customarily carried by companies
engaged in similar businesses and owning similar properties in localities where
the Borrower or the applicable Subsidiary operates.


 


5.11                        Taxes.  The Borrower and its Subsidiaries
have filed all Federal, state and other material tax returns and reports
required to be filed, and have paid all Federal, state and other material
taxes, assessments, fees and other governmental charges levied or imposed upon
them or their properties, income or assets otherwise due and payable, except
those which are being contested in good faith by appropriate proceedings
diligently conducted and for which adequate reserves have been provided in
accordance with GAAP.  To the best of
Responsible Officers’ knowledge, there is no proposed tax assessment against
the Borrower or any Subsidiary that would, if made, have a Material Adverse
Effect.


 


5.12                        ERISA Compliance.


 


(a)                                  Each
Plan is in compliance in all material respects with the applicable provisions
of ERISA, the Code and other Laws.  The
Borrower and each ERISA Affiliate have made all required contributions to each
Plan subject to Section 412 of the Code, and no application for a funding
waiver or an extension of any amortization period pursuant to Section 412
of the Code has been made with respect to any Plan.


 


(b)                                 There
are no pending or, to the best knowledge of the Borrower, threatened claims,
actions or lawsuits, or action by any Governmental Authority, with respect to
any Plan that could be reasonably be expected to have a Material Adverse
Effect.  Except as specifically
disclosed on Schedule 5.12,
there has been no prohibited transaction or violation of the fiduciary
responsibility rules with respect to any Plan that has resulted or could
reasonably be expected to result in a Material Adverse Effect.


 


45

















 


(c)                                  (i)  No ERISA Event has occurred or is reasonably
expected to occur; (ii) no Pension Plan has any Unfunded Pension Liability;
(iii) neither the Borrower nor any ERISA Affiliate has incurred, or reasonably
expects to incur, any liability under Title IV of ERISA with respect to any
Pension Plan (other than premiums due and not delinquent under
Section 4007 of ERISA); (iv) neither the Borrower nor any ERISA Affiliate
has incurred, or reasonably expects to incur, any liability (and no event has
occurred which, with the giving of notice under Section 4219 of ERISA,
would result in such liability) under Sections 4201 or 4243 of ERISA with
respect to a Multiemployer Plan; and (v) neither the Borrower nor any ERISA
Affiliate has engaged in a transaction that could be subject to Sections 4069
or 4212(c) of ERISA.


 


5.13                        Subsidiaries.  As of the Closing Date, the Borrower has no
Subsidiaries other than those specifically disclosed in Part (a) of Schedule 5.13 and has no material
equity investments in any other corporation or entity other than those
specifically disclosed in Part (b) of Schedule 5.13.


 


5.14                        Margin Regulations; Investment Company Act; Public
Utility Holding Company Act.


 


(a)                                  The
Borrower is not engaged and will not engage, principally or as one of its
important activities, in the business of purchasing or carrying margin stock
(within the meaning of Regulation U issued by the FRB), or extending credit for
the purpose of purchasing or carrying margin stock.


 


(b)                                 None
of the Borrower, any Person Controlling the Borrower, or any Subsidiary (i) is
a “holding company,” or a “subsidiary company” of a “holding company,” or an
“affiliate” of a “holding company” or of a “subsidiary company” of a “holding
company” within the meaning of the Public Utility Holding Company Act of 1935
or subject to regulation thereunder, or (ii) is or is required to be registered
as an “investment company” under the Investment Company Act of 1940.


 


5.15                        Disclosure.  The Borrower has disclosed to the
Administrative Agent and the Lenders all agreements, instruments and corporate
or other restrictions to which it or any of its Subsidiaries is subject, and
all other matters known to it, that, individually or in the aggregate, could
reasonably be expected to result in a Material Adverse Effect.  For purposes of this Section 5.15,
information that is disclosed in reports on Forms 10-K, 10-Q and 8-K or in
definitive proxy materials filed by the Borrower with the SEC shall be deemed
to have been disclosed to the Administrative Agent and the Lenders.  No report, financial statement, certificate
or other information furnished (whether in writing or orally) by or on behalf
of any Loan Party to the Administrative Agent or any Lender in connection with
the transactions contemplated hereby and the negotiation of this Agreement or
delivered hereunder (as modified or supplemented by other information so
furnished) contains any material misstatement of fact or omits to state any
material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that,
with respect to projected financial information, the Borrower represents only
that such information was prepared in good faith based upon assumptions
believed to be reasonable at the time.


 


46

















 


5.16                        Compliance with Laws.  Each of
the Borrower and each Subsidiary is in compliance in all material respects with
the requirements of all Laws and all orders, writs, injunctions and decrees
applicable to it or to its properties, except in such instances in which (a)
such requirement of Law or order, writ, injunction or decree is being contested
in good faith by appropriate proceedings diligently conducted or (b) the
failure to comply therewith, either individually or in the aggregate, could not
reasonably be expected to have a Material Adverse Effect.


 


ARTICLE VI.

AFFIRMATIVE COVENANTS


 


So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding, the Borrower shall, and shall (except in the
case of the covenants set forth in Sections 6.01, 6.02, 6.03
and 6.11) cause each Subsidiary to:


 


6.01                        Financial Statements.  Deliver to the Administrative Agent and each Lender, in
form and detail satisfactory to the Administrative Agent and the Required
Lenders:


 


(a)                                  as
soon as available, but in any event within 90 days after the end of each fiscal
year of the Borrower, a consolidated balance sheet of the Borrower and its
Subsidiaries as at the end of such fiscal year, and the related consolidated
statements of income or operations, shareholders’ equity and cash flows for
such fiscal year, setting forth in each case in comparative form the figures
for the previous fiscal year, all in reasonable detail and prepared in
accordance with GAAP, audited and accompanied by a report and opinion of an
independent certified public accountant of nationally recognized standing
reasonably acceptable to the Required Lenders, which report and opinion shall
be prepared in accordance with generally accepted auditing standards and shall
not be subject to any “going concern” or like qualification or exception or any
qualification or exception as to the scope of such audit;


 


(b)                                 as
soon as available, but in any event within 45 days after the end of each of the
first three fiscal quarters of each fiscal year of the Borrower, a consolidated
balance sheet of the Borrower and its Subsidiaries as at the end of such fiscal
quarter, and the related consolidated statements of income or operations,
shareholders’ equity and cash flows for such fiscal quarter and for the portion
of the Borrower’s fiscal year then ended, setting forth in each case in
comparative form the figures for the corresponding fiscal quarter of the previous
fiscal year and the corresponding portion of the previous fiscal year, all in
reasonable detail and certified by a Responsible Officer of the Borrower as
fairly presenting, in all material respects, the financial condition, results
of operations, shareholders’ equity and cash flows of the Borrower and its
Subsidiaries and prepared in accordance with GAAP, subject only to normal
year-end audit adjustments and the absence of footnotes; and


 


(c)                                  By
April 29 of each year, a projection of the cash flows of Borrower and its
Subsidiaries for such year, in form and scope acceptable to Administrative
Agent.


 


47



















 


As to any information contained in materials furnished pursuant to Section 6.02(d),
the Borrower shall not be separately required to furnish such information under
clause (a) or (b) above, but the foregoing shall not be in derogation of the
obligation of the Borrower to furnish the information and materials described
in subsections (a) and (b) above at the times specified therein.


 


6.02                        Certificates; Other Information.  Deliver to the Administrative Agent and each
Lender, in form and detail reasonably satisfactory to the Administrative Agent
and the Required Lenders:


 


(a)                                  concurrently
with the delivery of the financial statements referred to in Section 6.01(a)
(or if such financial statements are delivered electronically, within two (2)
Business Days of such electronic delivery), a certificate of its independent
certified public accountants certifying such financial statements and stating
that in making the examination necessary therefor no knowledge was obtained of
any Default or, if any such Default shall exist, stating the nature and status
of such event;


 


(b)                                 concurrently
with the delivery of the financial statements referred to in Sections
6.01(a) and (b) (or if such financial statements are delivered
electronically, within two (2) Business Days of such electronic delivery), a
duly completed Compliance Certificate signed by a Responsible Officer of the
Borrower;


 


(c)                                  promptly
after any request by the Administrative Agent or any Lender, copies of any
detailed audit reports, management letters or recommendations submitted to the
board of directors (or the audit committee of the board of directors) of the
Borrower by independent certified public accountants in connection with the
accounts or books of the Borrower or any Subsidiary, or any audit of any of them;


 


(d)                                 promptly
after the same are available, copies of each annual report, proxy or financial
statement or other report or communication sent to the stockholders of the
Borrower, and copies of all annual, regular, periodic and special reports and
registration statements which the Borrower may file or be required to file with
the SEC under Section 13 or 15(d) of the Securities Exchange Act of 1934,
and not otherwise required to be delivered to the Administrative Agent pursuant
hereto;


 


(e)                                  promptly,
such additional information regarding the business, financial or corporate
affairs of the Borrower or any Subsidiary, or compliance with the terms of the
Loan Documents, as the Administrative Agent or any Lender may from time to time
reasonably request;


 


(f)                                    As
soon as delivered to holders of the Debt Securities, copies of all reports,
statements and notices delivered generally to holders of Debt Securities
(excluding data which Borrower deems duplicative, immaterial or inapplicable
for delivery to Administrative Agent and Lenders).


 


Documents required to be delivered pursuant to Section 6.01(a)
, (b) or (c) or Section 6.02(c) or (d) (to the extent any
such documents are included in materials otherwise filed


 


48

















 


with the SEC) may be delivered electronically and if so delivered,
shall be deemed to have been delivered on the date (i) on which the Borrower
posts such documents, or provides a link thereto on the Borrower’s website on
the Internet at the website address listed on Schedule 10.02;
or (ii) on which such documents are posted on the Borrower’s behalf on
IntraLinks/IntraAgency or another relevant website, if any, including, but not
limited to any filings made on EDGAR to which each Lender and the Administrative
Agent have access (whether a commercial, third-party website or whether
sponsored by the Administrative Agent); provided that: (i) the Borrower shall
deliver paper copies of such documents to the Administrative Agent or any
Lender that requests the Borrower to deliver such paper copies until a written
request to cease delivering paper copies is given by the Administrative Agent
or such Lender and (ii) the Borrower shall notify (which may be by facsimile or
electronic mail) the Administrative Agent and each Lender of the posting of any
such documents and provide to the Administrative Agent by electronic mail
electronic versions (i.e., soft copies) of such documents.  Notwithstanding anything contained herein,
in every instance the Borrower shall be required to provide paper copies of the
Compliance Certificates required by Section 6.02(b) to the
Administrative Agent and each of the Lenders. 
Except for such Compliance Certificates, the Administrative Agent shall
have no obligation to request the delivery or to maintain copies of the
documents referred to above, and in any event shall have no responsibility to
monitor compliance by the Borrower with any such request for delivery, and each
Lender shall be solely responsible for requesting delivery to it or maintaining
its copies of such documents.


 


The Borrower hereby acknowledges that (a) the Administrative Agent
and/or the Arranger will make available to the Lenders and the L/C Issuer
materials and/or information provided by or on behalf of the Borrower hereunder
(collectively, “Borrower Materials”) by posting the Borrower Materials
on IntraLinks or another similar electronic system (the “Platform”) and
(b) certain of the Lenders may be “public-side” Lenders (i.e., Lenders that do not wish to receive
material non-public information with respect to the Borrower or its securities)
(each, a “Public Lender”).  The
Borrower hereby agrees that (w) all Borrower Materials that are to be made
available to Public Lenders shall be clearly and conspicuously marked “PUBLIC”
which, at a minimum, shall mean that the word “PUBLIC” shall appear prominently
on the first page thereof; provided that the Borrower shall have no obligation
to mark any document “PUBLIC”; (x) by marking Borrower Materials “PUBLIC,” the
Borrower shall be deemed to have authorized the Administrative Agent, the
Arranger, the L/C Issuer and the Lenders to treat such Borrower Materials as
either publicly available information or not material information (although it
may be sensitive and proprietary) with respect to the Borrower or its
securities for purposes of United States Federal and state securities laws; (y)
all Borrower Materials marked “PUBLIC” are permitted to be made available
through a portion of the Platform designated “Public Investor;” and (z) the
Administrative Agent and the Arranger shall be entitled to treat any Borrower
Materials that are not marked “PUBLIC” as being suitable only for posting on a
portion of the Platform not designated “Public Investor.”


 


6.03                        Notices.  Promptly notify the Administrative Agent and
each Lender:


 


(a)                                  of
the occurrence of any Default;


 


49

















 


(b)                                 of
any matter that has resulted or could reasonably be expected to result in a
Material Adverse Effect, including (i) breach or non-performance of, or any
default under, a Contractual Obligation of the Borrower or any Subsidiary; (ii)
any dispute, litigation, investigation, proceeding or suspension between the
Borrower or any Subsidiary and any Governmental Authority; or (iii) the
commencement of, or any material development in, any litigation or proceeding
to which the Borrower or any Subsidiary is a party or of which any of their
respective property is the subject, including pursuant to any applicable
Environmental Laws;


 


(c)                                  of
the occurrence of any ERISA Event;


 


(d)                                 of
any material change in accounting policies or financial reporting practices by
the Borrower or any Subsidiary; and


 


(e)                                  (e)                                  of
any announcement by Moody’s or S&P of any downward change in a Debt Rating
of which Responsible Officer has knowledge.


 


Each notice pursuant to this Section shall be accompanied by a
statement of a Responsible Officer of the Borrower setting forth details of the
occurrence referred to therein and stating what action the Borrower has taken
and proposes to take with respect thereto. 
Each notice pursuant to Section 6.03(a) shall describe with
particularity any and all provisions of this Agreement and any other Loan
Document that have been breached.


 


6.04                        Payment of Obligations.  Pay and
discharge as the same shall become due and payable, all its obligations and
liabilities, including (a) all tax liabilities, assessments and governmental
charges or levies upon it or its properties or assets, unless the same are
being contested in good faith by appropriate proceedings diligently conducted
and adequate reserves in accordance with GAAP are being maintained by the
Borrower or such Subsidiary; (b) all lawful claims which, if unpaid, would by
law become a Lien upon its property; and (c) all Indebtedness, as and when due
and payable, but subject to any subordination provisions contained in any
instrument or agreement evidencing such Indebtedness.


 


6.05                        Preservation of Existence, Etc..  (a) Preserve, renew and maintain in full
force and effect its legal existence and good standing under the Laws of the
jurisdiction of its organization except in a transaction permitted by Section 7.04
or 7.05; (b) take all reasonable action to maintain all rights,
privileges, permits, licenses and franchises necessary or desirable in the
normal conduct of its business, except to the extent that failure to do so
could not reasonably be expected to have a Material Adverse Effect; and (c)
preserve or renew all of its registered patents, trademarks, trade names and
service marks, the non-preservation of which could reasonably be expected to
have a Material Adverse Effect.


 


6.06                        Maintenance of Properties.  (a) Maintain, preserve and protect all of its material properties
and equipment necessary in the operation of its business in good working order
and condition, ordinary wear and tear excepted; and (b) make all necessary
repairs thereto and renewals and replacements thereof except where the failure
to do so could not reasonably be


 


50

















 


expected to have a Material Adverse Effect; and (c) use the standard of
care typical in the industry in the operation and maintenance of its
facilities.


 


6.07                        Maintenance of Insurance.  Maintain with financially sound and reputable insurance companies
not Affiliates of the Borrower, insurance with respect to its properties and
business against loss or damage of the kinds customarily insured against by
Persons engaged in the same or similar business, of such types and in such
amounts as are customarily carried under similar circumstances by such other
Persons.  Borrower and its Subsidiaries
shall maintain business interruption insurance in an amount providing not less
than $10,000,000 coverage for the covered persons, taken as a whole.


 


6.08                        Compliance with Laws.  Comply in all material respects with the requirements of all Laws
and all orders, writs, injunctions and decrees applicable to it or to its
business or property, except in such instances in which (a) such requirement of
Law or order, writ, injunction or decree is being contested in good faith by
appropriate proceedings diligently conducted; or (b) the failure to comply
therewith could not reasonably be expected to have a Material Adverse Effect.


 


6.09                        Books and Records. 
Maintain proper books of record and account, in which full, true and
correct entries in conformity with GAAP consistently applied shall be made of
all financial transactions and matters involving the assets and business of the
Borrower or such Subsidiary, as the case may be.


 


6.10                        Inspection Rights.  Permit
representatives and independent contractors of the Administrative Agent on
behalf of Lenders to visit and inspect any of its properties, to examine its
corporate, financial and operating records, and make copies thereof or abstracts
therefrom, and to discuss its affairs, finances and accounts with its
directors, officers, and independent public accountants, at such reasonable
times during normal business hours and as often as may be reasonably desired,
upon reasonable advance notice to the Borrower; provided, however,
that when an Event of Default exists the Administrative Agent or any Lender (or
any of their respective representatives or independent contractors) may do any
of the foregoing at the expense of the Borrower at any time during normal
business hours and without advance notice.


 


6.11                        Use of Proceeds.  Use the proceeds of the Credit Extensions
for general corporate purposes not in contravention of any Law or of any Loan
Document, including repayment of Indebtedness under the Existing Credit
Agreement and financing acquisitions.


 


6.12                        Guaranties of Borrower’s Subsidiaries. 
Subject to Section 6.13(b), cause each of the
following Domestic Subsidiaries to, and each such Person who becomes a Domestic
Subsidiary after the date hereof (to the extent such Domestic Subsidiary meets
the criteria set forth in this Section 6.12) to, within thirty (30)
days after becoming a Domestic Subsidiary, execute and deliver to
Administrative Agent an absolute and unconditional guaranty of the timely
repayment of the Obligations of Borrower and the due and punctual performance
of the Obligations of Borrower, which guaranty shall be substantially in the
form of Exhibit E:


 


51

















 


(a)                                  Each
Domestic Subsidiary of Borrower which has EBITDA in any fiscal quarter of
Borrower which constitutes ten percent (10%) or more of Borrower’s Consolidated
EBITDA for such fiscal quarter or which has assets at any time with a book
value equal to or exceeding (10%) of the book value of Borrower’s consolidated
assets at such time;


 


(b)                                 If
the aggregate amount of Borrower’s unconsolidated EBITDA for any fiscal quarter
of Borrower plus the aggregate EBITDA of the Guarantors during such fiscal
quarter does not constitute eighty- five percent (85%) or more of Borrower’s
Consolidated EBITDA for such fiscal quarter or if the book value of Borrower’s
individual assets at any time plus the aggregate book value of the assets of
Guarantors at such time does not exceed eight-five percent (85%) of the book
value of the Borrower’s consolidated assets at such time, then Domestic
Subsidiaries of Borrower with aggregate assets and/or EBITDA sufficient to
comply with the eighty-five percent (85%) tests contained in this subsection;


 


(c)                                  Each
Domestic Subsidiary which Guarantees the Debt Securities or the Subordinated
Debt; and


 


(d)                                 Upon
request by the Administrative Agent on behalf of the Required Lenders, any
other Domestic Subsidiary of Borrower.


 


6.13                        Additional Guarantors and Stock Pledge.


 


(a)                                  Notify
the Administrative Agent at the time that any Person becomes a Domestic
Subsidiary that is required to execute and deliver a Guaranty pursuant to Section 6.12,
and (i) subject to Section 6.13(b), promptly thereafter (and in any
event within 30 days), cause such Person to become a Guarantor by executing and
delivering to the Administrative Agent a counterpart of the Guaranty or such
other document as the Administrative Agent shall deem appropriate for such
purpose and (ii) subject to Section 6.13(c), promptly thereafter
(and in any event within 30 days) pledge to the Administrative Agent the equity
interests in such Material Domestic Subsidiary by documents as the
Administrative Agent shall deem appropriate for such purpose and (iii) deliver
to the Administrative Agent documents of the types referred to in clauses (iii)
and (iv) of Section 4.01(a) and favorable opinions of counsel to
such Person (which shall cover, among other things, the legality, validity,
binding effect and enforceability of the documentation referred to in clauses
(i) and (ii) above), all in form, content and scope reasonably satisfactory to
the Administrative Agent.


 


(b)                                 No
PUC Subsidiary shall be required to provide a Guaranty pursuant to Section 6.12
or Section 6.13(a) unless regulatory approval shall have been
obtained for such Guaranty from the applicable public utility commission or
FERC having such regulatory authority over such PUC Subsidiary (in this
Section called the applicable “PUC”). 
Borrower shall cause each PUC Subsidiary required to deliver a Guaranty
pursuant to Sections 6.12 and 6.13(a) to use its best efforts to
obtain the approval of the applicable PUC for a Guaranty of the Obligations. In
the event that the applicable PUC shall require a Subsidiary to withdraw from
the Guaranty, such Subsidiary may so withdraw and the Administrative Agent
shall release such Subsidiary from the Guaranty; provided that a substitute
Subsidiary guarantor meeting the requirements of Sections 6.12 and 6.13
shall have executed and delivered the Guaranty unless all


 


52

















 


such substitute Subsidiaries are PUC Subsidiaries and are prohibited by
the applicable PUC from delivering a Guaranty.


 


(c)                                  No
PUC Subsidiary shall be required to execute and deliver any Security Document
pursuant to Section 6.13(a) unless regulatory approval shall have
been obtained for such Security Document from the applicable PUC.  Borrower shall cause each PUC Subsidiary
required to deliver a Security Document pursuant to Section 6.13(a)
to use its best efforts to obtain the approval of the applicable PUC for such
Security Document, granting to Administrative Agent, for the benefit of the
Lenders, Liens and security interests in such Collateral as required by Section 6.13(a)
(as applicable) to secure the Obligations. In the event that the applicable PUC
shall require that the equity interests of a PUC Subsidiary be released from
the Lien in favor of the Administrative Agent, the Administrative Agent shall
so release such equity interests; provided that replacement stock of another
Subsidiary acceptable to the Administrative Agent shall have been pledged to
Administrative Agent for the benefit of the Lenders unless all such substitute
Subsidiaries are PUC Subsidiaries and are prohibited by the applicable PUC from
having their equity interests pledged to Administrative Agent.


 


(d)                                 Neither
this Section 6.13 nor any other provision of any Loan Document
shall require a Guaranty or a Security Document by a PUC Subsidiary, in either
case, to the extent that such PUC Subsidiary shall not have obtained the
required approval of the applicable PUC after the exercise of its best efforts
in accordance with subsections (b) and (c) of this Section 6.13.


 


ARTICLE VII.

NEGATIVE COVENANTS


 


So long as any Lender shall have any Commitment hereunder, any Loan or
other Obligation hereunder shall remain unpaid or unsatisfied, or any Letter of
Credit shall remain outstanding, the Borrower shall not, nor shall it permit
any Subsidiary to, directly or indirectly:


 


7.01                        Liens.  Create, incur, assume or suffer to exist any
Lien upon any of its property, assets or revenues, whether now owned or
hereafter acquired, other than the following (each a “Permitted Lien” and
collectively, the “Permitted Liens”):


 


(a)                                  Liens
pursuant to any Loan Document;


 


(b)                                 Liens
existing on the date hereof and listed on Schedule 7.01
and any renewals or extensions thereof, provided that the property
covered thereby is not increased and any renewal or extension of the obligations
secured or benefited thereby is permitted by Section 7.03(b);


 


(c)                                  Liens
for taxes not yet due or which are being contested in good faith and by
appropriate proceedings diligently conducted, if adequate reserves with respect
thereto are maintained on the books of the applicable Person in accordance with
GAAP;


 


(d)                                 carriers’,
warehousemen’s, mechanics’, materialmen’s, repairmen’s or other like Liens
arising in the ordinary course of business which are not overdue for a period
of more than 30 days or which are being contested in good faith and by
appropriate proceedings diligently


 


53

















 


conducted, if adequate reserves with respect thereto are maintained on
the books of the applicable Person;


 


(e)                                  pledges
or deposits in the ordinary course of business in connection with workers’
compensation, unemployment insurance and other social security legislation,
other than any Lien imposed by ERISA;


 


(f)                                    deposits
to secure the performance of bids, trade contracts and leases (other than
Indebtedness), statutory obligations, surety bonds (other than bonds related to
judgments or litigation), performance bonds and other obligations of a like
nature incurred in the ordinary course of business;


 


(g)                                 easements,
rights-of-way, restrictions and other similar encumbrances affecting real
property which, in the aggregate, are not substantial in amount, and which do
not in any case materially detract from the value of the property subject
thereto or materially interfere with the ordinary conduct of the business of
the applicable Person;


 


(h)                                 Liens
securing judgments for the payment of money not constituting an Event of
Default under Section 8.01(h) or securing appeal or other surety
bonds related to such judgments;


 


(i)                                     Liens
securing capital leases permitted under Section 7.03(e); provided
that (i) such Liens do not at any time encumber any property other than the
property financed by such Indebtedness and (ii) the Indebtedness secured
thereby does not exceed the cost or fair market value, whichever is lower, of
the property being acquired on the date of acquisition;


 


(j)                                     Liens
on capital stock of the Guarantors securing the Debt Securities; and


 


(k)                                  Liens
on margin accounts established in connection with Swap Contracts permitted under
Section 7.11.


 


7.02                        Investments.  Make any Investments, except:


 


(a)                                  Investments
held by the Borrower or such Subsidiary in the form of cash equivalents;


 


(b)                                 Investments
in Subsidiaries already wholly owned by Borrower and/or its Subsidiaries and
the joint ventures described on Schedule 7.02;


 


(c)                                  Investments
maturing within one year from the date of acquisition in direct obligations of
or obligations supported by, the full faith and credit of, the United States of
America;


 


(d)                                 purchases
of open market commercial paper, maturing within 270 days after acquisition
thereof, with the highest or second highest credit rating given by either S
& P or Moody’s and investments in money market mutual funds with equivalent
ratings;


 


54

















 


(e)                                  acquisitions
of or investments in gas processing, treating, fractionation, transmission,
gathering and storage facilities, and domestic oil and gas properties (whether
in the United States or Canada);


 


(f)                                    loans
to finance the purchase by Borrower’s employees of certain real property,
provided that the aggregate outstanding amount of such loans shall not exceed
$500,000;


 


(g)                                 Investments
of the Borrower in any Guarantor and Investments of any Guarantor in the
Borrower or in another Guarantor;


 


(h)                                 Investments
consisting of extensions of credit in the nature of accounts receivable or
notes receivable arising from the grant of trade credit in the ordinary course
of business, and Investments received in satisfaction or partial satisfaction
thereof from financially troubled account debtors to the extent reasonably
necessary in order to prevent or limit loss;


 


(i)                                     Guarantees
permitted by Section 7.03;


 


(j)                                     Investments
of the Borrower or any Subsidiary made pursuant to any Swap Contract permitted
under Section 7.11; and


 


(k)                                  other
Investments not exceeding $5,000,000 in the aggregate in any fiscal year of the
Borrower.


 


7.03                        Indebtedness.  Create, incur, assume or suffer to exist any
Indebtedness, except (without duplication):


 


(a)                                  Indebtedness
under the Loan Documents;


 


(b)                                 Indebtedness
outstanding on the date hereof and listed on Schedule 7.03
and any refinancings, refundings, renewals or extensions thereof; provided
that the amount of such Indebtedness is not increased at the time of such refinancing,
refunding, renewal or extension except by an amount equal to a reasonable
premium or other reasonable amount paid, and fees and expenses reasonably
incurred, in connection with such refinancing and by an amount equal to any
existing commitments unutilized thereunder;


 


(c)                                  Guarantees
of the Borrower or any Guarantor in respect of Indebtedness otherwise permitted
hereunder of the Borrower;


 


(d)                                 Indebtedness
(contingent or otherwise) of the Borrower or any Subsidiary existing or arising
under any Swap Contract permitted under Section 7.11; provided that
such Swap Contract does not contain any provision exonerating the
non-defaulting party from its obligation to make payments on outstanding
transactions to the defaulting party;


 


(e)                                  Indebtedness
under leases, whether capital leases or operating leases, entered into in the
ordinary course of business in arm’s-length transactions at competitive market
rates under competitive terms and conditions considering all aspects thereof,
provided that the obligations payable over the remaining lives of any such
leases (excluding obligations under oil and gas


 


55

















 


leases, real estate leases for office space used by Borrower, leases
for vehicles, office equipment and data processing equipment and gas compressor
and gas processing plant site leases) do not in the aggregate exceed
$75,000,000;


 


(f)                                    unsecured
Indebtedness between Borrower and any Guarantor;


 


(g)                                 Indebtedness
under the Debt Securities;


 


(h)                                 the
Subordinated Debt;


 


(i)                                     unsecured
Indebtedness of the Borrower not described in subsections (a) through (h) above
which meets the following requirements: (A) the documentation evidencing such
Indebtedness shall contain no terms, conditions or defaults (other than pricing)
which are more favorable to the third party creditor than those contained in
this Agreement are to Lenders, as determined by Required Lenders in their
discretion (provided that Required Lenders shall make any such determination
considering any amendments or modifications to this Agreement existing at the
time of the incurrence of such Indebtedness) and shall not contain any
provision which attempts to modify, amend or restrict any of the rights or
remedies of Agent or Lenders hereunder or under any of the other Loan
Documents, (B) such Indebtedness shall have no scheduled principal payments due
prior to the final maturity of the Obligations, (C) at the time the Borrower
incurs such Indebtedness, no Default or Event of Default shall have occurred
and be continuing hereunder and (D) if such Indebtedness is to be guaranteed by
any Affiliate of the Borrower, then such third party lender(s) must enter into
an inter-creditor agreement with Lenders, in form, scope and substance which is
acceptable to Required Lenders, as evidenced by their written consent;


 


(j)                                     CP
Debt; and


 


(k)                                  miscellaneous
items of unsecured Indebtedness not described in subsections (a) through (k) of
this Section 7.03 which do not in the aggregate (taking into
account all Indebtedness of Borrower and its Subsidiaries) exceed $10,000,000
at any one time outstanding.


 


7.04                        Fundamental Changes; Issuance of Stock.  Merge, dissolve, liquidate, consolidate with
or into another Person, or Dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its assets (whether now
owned or hereafter acquired) to or in favor of any Person, except that, so long
as no Default exists or would result therefrom:


 


(a)                                  the
Borrower may merge with another Person; provided that the Borrower is the
surviving Person and immediately after such merger or consolidation, no Default
would exist;


 


(b)                                 any
Subsidiary may merge with (i) the Borrower, provided that the Borrower
shall be the continuing or surviving Person, or (ii) any one or more other
Subsidiaries, provided that when any Guarantor is merging with another
Subsidiary, the Guarantor shall be the continuing or surviving Person; and


 


(c)                                  any
Subsidiary may Dispose of all or substantially all of its assets (upon
voluntary liquidation or otherwise) to the Borrower or to another Subsidiary; provided
that if the transferor


 


56

















 


in such a
transaction is a Guarantor, then the transferee must either be the Borrower or
a Guarantor.


 


Neither the Borrower nor any Subsidiary will issue partnership
interests, stock, or other securities of Borrower or of any of Borrower’s
Subsidiaries (other than shares of its common stock or warrants to purchase its
common stock or warrants or options to acquire such common stock), nor will any
Subsidiary of the Borrower allow any diminution of the Borrower’s interest
(direct or indirect) therein; provided that preferred stock of the Borrower may
be issued if such preferred stock (including without limitation, the amount and
terms thereof) has been approved in writing by Required Lenders prior to the
issuance thereof.


 


7.05                        Dispositions.  Make any Disposition or enter into
any agreement to make any Disposition, except:


 


(a)                                  Dispositions
of obsolete or worn out property, whether now owned or hereafter acquired, in
the ordinary course of business or property otherwise not being used in the
operations of the Borrower or any Subsidiary;


 


(b)                                 Dispositions
of inventory in the ordinary course of business;


 


(c)                                  Dispositions
of equipment or real property to the extent that (i) such property is exchanged
for credit against the purchase price of similar replacement property or (ii)
the proceeds of such Disposition are reasonably promptly applied to the
purchase price of such replacement property;


 


(d)                                 Dispositions
of property by any Subsidiary to the Borrower or to a wholly-owned Subsidiary; provided
that if the transferor of such property is a Guarantor, the transferee thereof
must either be the Borrower or a Guarantor;


 


(e)                                  Dispositions
permitted by Section 7.04;


 


(f)                                    Dispositions
of property by the Borrower and its Subsidiaries in arms’ length transactions
to third parties that are not Affiliates of the Borrower for consideration (i)
solely in property similar to the property being disposed of and (ii) with a
fair market value that is equivalent to the fair market value of the property
being disposed of; and


 


(g)                                 Dispositions
by the Borrower and its Subsidiaries in arms’ length transactions to third
parties that are not Affiliates of the Borrower and which are not otherwise
covered by this Section 7.05 for consideration equal to the fair
market value thereof; provided that (i) at the time of such Disposition,
no Default shall exist or would result from such Disposition and (ii) the
aggregate book value of all property Disposed of in reliance on this clause (f)
in any fiscal year shall not exceed $35,000,000.


 


7.06                        Restricted Payments.  Declare or
make, directly or indirectly, any Restricted Payment, or incur any obligation
(contingent or otherwise) to do so, except that:


 


57

















 


(a)                                  the
Borrower may declare and make dividend payments to its shareholders so long as
no Default or Event of Default exists at the time such dividend is declared or
paid or would occur as a result thereof;


 


(b)                                 each
Subsidiary may make Restricted Payments to the Borrower and any Guarantor;


 


(c)                                  the
Borrower and each Subsidiary may declare and make dividend payments or other
distributions payable solely in the common stock or other common equity
interests of such Person;


 


(d)                                 so
long as no Default or Event of Default has occurred and is continuing, or will
occur as a result thereof, Borrower and each Subsidiary may make contributions,
purchases, redemptions, acquisitions and retirements with respect to any shares
of its capital stock;


 


(e)                                  the
Borrower and each Subsidiary may purchase, redeem or otherwise acquire shares
of its common stock or other common equity interests or warrants or options to
acquire any such shares with the proceeds received from the substantially
concurrent issue of new shares of its common stock or other common equity
interests;


 


(f)                                    the
Borrower may make Restricted Payments with respect to the Debt Securities so
long as no Default or Event of Default exists at the time thereof or will occur
as a result thereof.


 


7.07                        Change in Nature of Business.  Engage in any material line of business substantially different
from those lines of business conducted by the Borrower and its Subsidiaries on
the date hereof or any business substantially related or incidental thereto.


 


7.08                        Transactions with Affiliates.  Enter into any transaction of any kind with
any Affiliate of the Borrower, whether or not in the ordinary course of
business, other than on fair and reasonable terms substantially as favorable to
the Borrower or such Subsidiary as would be obtainable by the Borrower or such
Subsidiary at the time in a comparable arm’s length transaction with a Person
other than an Affiliate, provided that the foregoing restriction shall not
apply to transactions between or among the Borrower and any Guarantor or
between and among any Guarantors.


 


7.09                        Burdensome Agreements.  Enter
into any Contractual Obligation (other than this Agreement, any other Loan
Document, the Contractual Obligations entered into pursuant to the Debt
Securities, and the Indenture) that (a) limits the ability (i) of any
Subsidiary to make Restricted Payments to the Borrower or any Guarantor or to
otherwise transfer property to the Borrower or any Guarantor, (ii) of any
Subsidiary to Guarantee the Indebtedness of the Borrower or (iii) of the
Borrower or any Subsidiary to create, incur, assume or suffer to exist Liens on
property of such Person; provided, however, that this clause
(iii) shall not prohibit any negative pledge incurred or provided in favor of
any holder of Indebtedness permitted under Section 7.03(e) solely
to the extent any such negative pledge relates to the property financed by


 


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or the subject of such Indebtedness; or (b) requires the grant of a
Lien to secure an obligation of such Person if a Lien is granted to secure
another obligation of such Person.


 


7.10                        Use of Proceeds.  Use the proceeds of any Credit
Extension, whether directly or indirectly, and whether immediately,
incidentally or ultimately, to purchase or carry margin stock (within the
meaning of Regulation U of the FRB) or to extend credit to others for the
purpose of purchasing or carrying margin stock or to refund indebtedness
originally incurred for such purpose.


 


7.11                        Limitation for Net Products Exposure.  Enter into, or otherwise be a party to any
Swap Contract that does not comply with the Risk Management Policy.  Furthermore, the aggregate value at risk, or
VaR limits (as defined below), calculated in accordance with the Risk
Management Policy, shall not at any time exceed $5,000,000.  For purposes of this Section 7.11,
the term “VaR limits” means the maximum allowable change in aggregate
mark-to-market (i.e., unrealized losses) dollars, with a given probability,
over a one-day time horizon (as provided in the Risk Management Policy).


 


7.12                        Financial Covenants.


 


(a)                                  Interest
Coverage Ratio.  Permit the Interest
Coverage Ratio as of the end of any fiscal quarter of the Borrower, calculated
for the four consecutive fiscal quarters then ended, to be less than 3.0 to
1.0.


 


(b)                                 Debt
to Capitalization Ratio.  Permit the
Debt to Capitalization Ratio for any fiscal quarter of the Borrower to be
greater than 0.55 to 1.0.


 


ARTICLE VIII.

EVENTS OF DEFAULT AND REMEDIES


 


8.01                        Events of Default.  Any of the following shall constitute an
Event of Default:


 


(a)                                  Non-Payment.  The Borrower or any other Loan Party fails
to pay (i) when and as required to be paid herein, any amount of principal of
any Loan or any L/C Obligation, or (ii) within ten days after the same becomes
due, any interest on any Loan or on any L/C Obligation, or any Commitment Fee
or other fee due hereunder, or (iii) within ten days after the same becomes
due, any other amount payable hereunder or under any other Loan Document; or


 


(b)                                 Specific
Covenants.  The Borrower fails to
perform or observe any term, covenant or agreement contained in any of Sections
6.03, 6.12 or 6.13 or in Article VII; or


 


(c)                                  Other
Defaults.  Any Loan Party fails to
perform or observe any other covenant or agreement (not specified in
subsection (a) or (b) above) contained in any Loan Document on its part to
be performed or observed and such failure continues for 30 days; or


 


(d)                                 Representations
and Warranties.  Any representation,
warranty, certification or statement of fact made or deemed made by or on
behalf of the Borrower or any other Loan Party


 


59

















 


herein, in any
other Loan Document, or in any document delivered in connection herewith or
therewith shall be incorrect or misleading when made or deemed made and such
representation or warranty does not become true and correct within thirty (30)
days; or


 


(e)                                  Cross-Default.


 


(i)                                     the
Borrower or any Subsidiary (A) fails to make any payment when due (whether by
scheduled maturity, required prepayment, acceleration, demand, or otherwise) in
respect of any of the Debt Securities or the Subordinated Debt, or (B) fails to
observe or perform any other agreement or condition relating to the Debt
Securities or the Subordinated Debt, or any other event occurs, in the instance
of both the circumstances of (i)(A) and (i)(B), the effect of which default or
other event is to cause, or to permit the holder or holders of such
Indebtedness (or a trustee or agent on behalf of such holder or holders or
beneficiary or beneficiaries) to cause, with the giving of notice if required,
such Indebtedness to be demanded or to become due or to be repurchased,
prepaid, defeased or redeemed (automatically or otherwise), or an offer to
repurchase, prepay, defease or redeem such Indebtedness to be made, prior to
its stated maturity; or


 


(ii)                                  the
Borrower or any Subsidiary (A) fails to make any payment when due (whether by
scheduled maturity, required prepayment, acceleration, demand, or otherwise) in
respect of any Indebtedness or Guarantee (other than Indebtedness hereunder and
Indebtedness under Swap Contracts, the Debt Securities and the Subordinated
Debt), (B) fails to observe or perform any other agreement or condition
relating to any such Indebtedness or Guarantee or contained in any instrument
or agreement evidencing, securing or relating thereto, or any other event
occurs, in the instance of both the circumstances of (ii)(A) and (ii)(B), the
effect of which default or other event is to cause, or to permit the holder or
holders of such Indebtedness or the beneficiary or beneficiaries of such
Guarantee (or a trustee or agent on behalf of such holder or holders or
beneficiary or beneficiaries) to cause, with the giving of notice if required,
such Indebtedness to be demanded or to become due or to be repurchased,
prepaid, defeased or redeemed (automatically or otherwise), or an offer to
repurchase, prepay, defease or redeem such Indebtedness to be made, prior to
its stated maturity, or such Guarantee to become payable or cash collateral in
respect thereof to be demanded unless the Borrower or a Subsidiary is
contesting the validity of such Obligation by appropriate proceedings and has
set aside on its books adequate allowance accounts therefor in accordance with
GAAP; or


 


(iii)                               there
occurs under any Swap Contract an Early Termination Date (as defined in such
Swap Contract) resulting from (A) any event of default under such Swap Contract
as to which the Borrower or any Subsidiary is the Defaulting Party (as defined
in such Swap Contract) or (B) any Termination Event (as so defined in such Swap
Contract) under such Swap Contract as to which the Borrower or any Subsidiary
is an Affected Party (as so defined) that in the case of (A) or (B) causes
Borrower or any Subsidiary to become obligated to make payments to the
counterparty thereunder and the aggregate amount of all such payments for which
Borrower is obligated under Swap Contracts at any time exceeds $10,000,000; or


 


60

















 


(f)                                    Insolvency
Proceedings, Etc.  Any Loan Party or
any of its Subsidiaries institutes or consents to the institution of any
proceeding under any Debtor Relief Law, or makes an assignment for the benefit
of creditors; or applies for or consents to the appointment of any receiver,
trustee, custodian, conservator, liquidator, rehabilitator or similar officer
for it or for all or any material part of its property; or any receiver,
trustee, custodian, conservator, liquidator, rehabilitator or similar officer
is appointed without the application or consent of such Person and the
appointment continues undischarged or unstayed for 60 calendar days; or any
proceeding under any Debtor Relief Law relating to any such Person or to all or
any material part of its property is instituted without the consent of such
Person and continues undismissed or unstayed for 60 calendar days, or an order
for relief is entered in any such proceeding; or


 


(g)                                 Inability
to Pay Debts; Attachment.  (i) the
Borrower or any Subsidiary becomes unable or admits in writing its inability or
fails generally to pay its debts as they become due, or (ii) any writ or
warrant of attachment or execution or similar process is issued or levied
against any of the Collateral or all or any material part of the property of
any such Person and is not released, vacated or fully bonded within 30 days
after its issue or levy; or


 


(h)                                 Judgments.  There is entered against the Borrower or any
Subsidiary (i) during any fiscal year of the Borrower, any one or more final
judgments or orders for the payment of money in an aggregate amount exceeding
$10,000,000 (to the extent not covered by independent third-party insurance as
to which the insurer does not dispute coverage), or (ii) any one or more
non-monetary final judgments that have, or could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect and,
in either case, (A) enforcement proceedings are commenced by any creditor upon
such judgment or order, or (B) there is a period of 10 consecutive days during
which a stay of enforcement of such judgment, by reason of a pending appeal or
otherwise, is not in effect; or


 


(i)                                     ERISA.  (i) An ERISA Event occurs with respect to a
Pension Plan or Multiemployer Plan which has resulted or could reasonably be
expected to result in liability of the Borrower under Title IV of ERISA to the
Pension Plan, Multiemployer Plan or the PBGC in an aggregate amount in excess
of $10,000,000, or (ii) the Borrower or any ERISA Affiliate fails to pay when
due, after the expiration of any applicable grace period, any installment
payment with respect to its withdrawal liability under Section 4201 of
ERISA under a Multiemployer Plan in an aggregate amount in excess of
$10,000,000; or


 


(j)                                     Invalidity
of Loan Documents.  Any Loan
Document, at any time after its execution and delivery and for any reason other
than as expressly permitted hereunder or satisfaction in full of all the Obligations,
ceases to be in full force and effect; or any Loan Party or any other Person
contests in any manner the validity or enforceability of any Loan Document; or
any Loan Party denies that it has any or further liability or obligation under
any Loan Document, or purports to revoke, terminate or rescind any Loan
Document; or


 


(k)                                  Change
of Control.  There occurs any Change
of Control with respect to the Borrower; or


 


61

















 


(l)                                     Debt
Securities.  Without the express
prior written consent of Required Lenders, the Borrower amends or modifies the
terms of any of the documents or instruments governing, or otherwise executed
in connection with, any of the Debt Securities (including, but not limited to,
an amendment or modification to shorten the maturity of the Debt Securities or
increase the maximum principal amount of the Debt Securities); provided,
however, that without the consent of any Lender, the Borrower may amend such
documents or instruments (1) to increase the interest rate or fees payable
under or with respect to the Debt Securities, (2) to conform to amendments or
modifications made to the Loan Documents, and (3) to make changes in the
administration of the Debt Securities; or


 


(m)                               Subordinated
Debt.  Without the express prior
written consent of Required Lenders, the Borrower amends or modifies the terms
of any of the documents or instruments governing, or otherwise executed in
connection with, the Subordinated Debt, including but not limited to, an amendment
or modification to (a) shorten the maturity of the Subordinated Debt, (b)
increase the maximum principal amount of the Subordinated Debt, or (c) modify
the terms of the subordination of the Subordinated Debt to the Senior Debt; or


 


(n)                                 Preferred
Stock.  Without the express prior
written consent of Required Lenders, the Borrower amends or modifies any term
of the Preferred Stock except for modifications to correct any non-substantive
ambiguity or defect in the documents governing any such Preferred Stock.


 


8.02                        Remedies Upon Event of Default.  If any Event of Default occurs and is
continuing, the Administrative Agent shall, at the request of, or may, with the
consent of, the Required Lenders, take any or all of the following actions:


 


(a)                                  declare
the commitment of each Lender to make Loans and any obligation of the L/C
Issuer to make L/C Credit Extensions to be terminated, whereupon such
commitments and obligation shall be terminated;


 


(b)                                 declare
the unpaid principal amount of all outstanding Loans, all interest accrued and
unpaid thereon, and all other amounts owing or payable hereunder or under any
other Loan Document to be immediately due and payable, without presentment,
demand, protest or other notice of any kind, all of which are hereby expressly waived
by the Borrower;


 


(c)                                  require
that the Borrower Cash Collateralize the L/C Obligations (in an amount equal to
the then Outstanding Amount thereof); and


 


(d)                                 exercise
on behalf of itself and the Lenders all rights and remedies available to it and
the Lenders under the Loan Documents or applicable law;


 


provided, however, that upon the
occurrence of an actual or deemed entry of an order for relief with respect to
the Borrower under the Bankruptcy Code of the United States, the obligation of
each Lender to make Loans and any obligation of the L/C Issuer to make L/C
Credit Extensions shall automatically terminate, the unpaid principal amount of
all outstanding Loans and all interest and other amounts as aforesaid shall
automatically become due and payable, and the


 


62

















 


obligation of the Borrower to Cash Collateralize the L/C Obligations as
aforesaid shall automatically become effective, in each case without further
act of the Administrative Agent or any Lender.


 


8.03                        Application of Funds.  After the exercise of remedies provided for in Section 8.02
(or after the Loans have automatically become immediately due and payable and
the L/C Obligations have automatically been required to be Cash Collateralized
as set forth in the proviso to Section 8.02), any amounts received
on account of the Obligations (after distribution of any proceeds received by
Administrative Agent under the Security Documents in accordance with the terms
of the Intercreditor Agreement) shall be applied by the Administrative Agent in
the following order:


 


First, to payment of that portion of the
Obligations constituting fees, indemnities, expenses and other amounts
(including Attorney Costs and amounts payable under Article III)
payable to the Administrative Agent in its capacity as such;


 


Second, to payment of that portion of the
Obligations constituting fees, indemnities and other amounts (other than
principal and interest) payable to the Lenders (including Attorney Costs and
amounts payable under Article III), ratably among them in
proportion to the amounts described in this clause Second payable to
them;


 


Third, to payment of that portion of the
Obligations constituting accrued and unpaid interest on the Loans and L/C
Borrowings, ratably among the Lenders in proportion to the respective amounts
described in this clause Third payable to them;


 


Fourth, to payment of that portion of the
Obligations constituting unpaid principal of the Loans and L/C Borrowings,
ratably among the Lenders in proportion to the respective amounts described in
this clause Fourth held by them;


 


Fifth, to the Administrative Agent for the
account of the L/C Issuer, to Cash Collateralize that portion of L/C
Obligations comprised of the aggregate undrawn amount of Letters of Credit; and


 


Last, the balance, if any, after all of the
Obligations have been indefeasibly paid in full, to the Borrower or as
otherwise required by Law.


 


Subject to Section 2.03(c), amounts used to Cash
Collateralize the aggregate undrawn amount of Letters of Credit pursuant to
clause Fifth above shall be applied to satisfy drawings under such
Letters of Credit as they occur.  If any
amount remains on deposit as Cash Collateral after all Letters of Credit have
either been fully drawn or expired, such remaining amount shall be applied to
the other Obligations, if any, in the order set forth above.


 


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ARTICLE IX.

ADMINISTRATIVE AGENT


 


9.01                        Appointment and Authorization of Administrative
Agent.


 


(a)                                  Each
of the Lenders and the L/C Issuer hereby irrevocably appoints, designates and
authorizes the Administrative Agent to take such action on its behalf under the
provisions of this Agreement and each other Loan Document and to exercise such
powers and perform such duties as are expressly delegated to it by the terms of
this Agreement or any other Loan Document (including, without limitation, as a
secured party under any Security Document), together with such powers as are
reasonably incidental thereto. 
Notwithstanding any provision to the contrary contained elsewhere herein
or in any other Loan Document, the Administrative Agent shall not have any
duties or responsibilities, except those expressly set forth herein, nor shall
the Administrative Agent have or be deemed to have any fiduciary relationship
with any Lender or participant, and no implied covenants, functions,
responsibilities, duties, obligations or liabilities shall be read into this
Agreement or any other Loan Document or otherwise exist against the Administrative
Agent.  Without limiting the generality
of the foregoing sentence, the use of the term “agent” herein and in the other
Loan Documents with reference to the Administrative Agent is not intended to
connote any fiduciary or other implied (or express) obligations arising under
agency doctrine of any applicable Law. 
Instead, such term is used merely as a matter of market custom, and is
intended to create or reflect only an administrative relationship between independent
contracting parties.


 


(b)                                 The
L/C Issuer shall act on behalf of the Lenders with respect to any Letters of
Credit issued by it and the documents associated therewith, and the L/C Issuer
shall have all of the benefits and immunities (i) provided to the
Administrative Agent in this Article IX with respect to any acts
taken or omissions suffered by the L/C Issuer in connection with Letters of
Credit issued by it or proposed to be issued by it and the applications and
agreements for letters of credit pertaining to such Letters of Credit as fully
as if the term “Administrative Agent” as used in this Article IX
and in the definition of “Agent-Related Person” included the L/C Issuer with
respect to such acts or omissions, and (ii) as additionally provided herein
with respect to the L/C Issuer.


 


(c)                                  The
provisions of this Article IX are solely for the benefit of the
Administrative Agent, the Lenders and the L/C Issuer, and neither the Borrower
nor any other Loan Party shall have rights as a third party beneficiary of any
of such provisions.


 


9.02                        Delegation of Duties.  The Administrative Agent may execute any of its duties under this
Agreement or any other Loan Document by or through agents, employees or
attorneys-in-fact and shall be entitled to advice of counsel and other consultants
or experts concerning all matters pertaining to such duties.  The Administrative Agent shall not be
responsible for the negligence or misconduct of any agent or attorney-in-fact
that it selects in the absence of gross negligence or willful misconduct.


 


9.03                        Liability of Administrative Agent.  No Agent-Related Person shall (a) be liable
for any action taken or omitted to be taken by any of them under or in
connection with this Agreement or any other Loan Document or the transactions
contemplated hereby (in all cases, whether or not arising, in whole or in part,
out of the negligence of such Agent-Related Person, except for its own gross
negligence or willful misconduct in connection with its duties expressly set
forth herein), or (b) be responsible in any manner to any Lender or participant
for any recital, statement, representation or warranty made by any Loan Party
or any officer thereof, contained


 


64

















 


herein or in any other Loan Document, or in any certificate, report, statement
or other document referred to or provided for in, or received by the
Administrative Agent under or in connection with, this Agreement or any other
Loan Document, or the validity, effectiveness, genuineness, enforceability or
sufficiency of this Agreement or any other Loan Document, or for any failure of
any Loan Party or any other party to any Loan Document to perform its
obligations hereunder or thereunder.  No
Agent-Related Person shall be under any obligation to any Lender or participant
to ascertain or to inquire as to the observance or performance of any of the
agreements contained in, or conditions of, this Agreement or any other Loan
Document, or to inspect the properties, books or records of any Loan Party or
any Affiliate thereof.


 


9.04                        Reliance by Administrative Agent.


 


(a)                                  The
Administrative Agent shall be entitled to rely, and shall be fully protected in
relying, upon any writing, communication, signature, resolution,
representation, notice, consent, certificate, affidavit, letter, telegram,
facsimile, telex or telephone message, electronic mail message, statement or
other document or conversation believed by it to be genuine and correct and to
have been signed, sent or made by the proper Person or Persons, and upon advice
and statements of legal counsel (including counsel to any Loan Party),
independent accountants and other experts selected by the Administrative
Agent.  The Administrative Agent shall
be fully justified in failing or refusing to take any action under any Loan
Document unless it shall first receive such advice or concurrence of the
Required Lenders as it deems appropriate and, if it so requests, it shall first
be indemnified to its satisfaction by the Lenders against any and all liability
and expense which may be incurred by it by reason of taking or continuing to
take any such action.  The
Administrative Agent shall in all cases be fully protected in acting, or in
refraining from acting, under this Agreement or any other Loan Document in
accordance with a request or consent of the Required Lenders (or such greater
number of Lenders as may be expressly required hereby in any instance) and such
request and any action taken or failure to act pursuant thereto shall be
binding upon all the Lenders.


 


(b)                                 For
purposes of determining compliance with the conditions specified in Section 4.01,
each Lender that has signed this Agreement shall be deemed to have consented
to, approved or accepted or to be satisfied with, each document or other matter
required thereunder to be consented to or approved by or acceptable or
satisfactory to a Lender unless the Administrative Agent shall have received
notice from such Lender prior to the proposed Closing Date specifying its
objection thereto.


 


9.05                        Notice of Default. 
The Administrative Agent shall not, except as expressly set forth herein
and in the other Loan Documents, have any duty to disclose, and shall not be
liable for the failure to disclose, any information relating to the Borrower or
any of its Affiliates that is communicated to or obtained by the Person serving
as the Administrative Agent or any of its Affiliates in any capacity.  The Administrative Agent shall not be deemed
to have knowledge or notice of the occurrence of any Default, except with
respect to defaults in the payment of principal, interest and fees required to
be paid to the Administrative Agent for the account of the Lenders, unless the
Administrative Agent shall have received written notice from a Lender or the
Borrower referring to this Agreement, describing such Default and stating that
such notice is a “notice of default.” 
The Administrative Agent shall take such action with respect to such
Default


 


65

















 


as may be directed by the Required Lenders (or such other number or percentage
of the Lenders as shall be expressly provided for herein or in the other Loan
Documents) in accordance with Article VIII; provided, however,
that unless and until the Administrative Agent has received any such direction,
the Administrative Agent may (but shall not be obligated to) take such action,
or refrain from taking such action, with respect to such Default as it shall
deem advisable or in the best interest of the Lenders.


 


9.06                        Credit Decision; Disclosure of Information by
Administrative Agent.  Each Lender
acknowledges that no Agent-Related Person has made any representation or
warranty to it, and that no act by the Administrative Agent hereafter taken,
including any consent to and acceptance of any assignment or review of the
affairs of any Loan Party or any Affiliate thereof, shall be deemed to
constitute any representation or warranty by any Agent-Related Person to any
Lender as to any matter, including whether Agent-Related Persons have disclosed
material information in their possession. 
Each Lender represents to the Administrative Agent that it has,
independently and without reliance upon any Agent-Related Person and based on
such documents and information as it has deemed appropriate, made its own
appraisal of and investigation into the business, prospects, operations,
property, financial and other condition and creditworthiness of the Loan
Parties and their respective Subsidiaries, and all applicable bank or other
regulatory Laws relating to the transactions contemplated hereby, and made its
own decision to enter into this Agreement and to extend credit to the Borrower
hereunder.  Each Lender also represents
that it will, independently and without reliance upon any Agent-Related Person
and based on such documents and information as it shall deem appropriate at the
time, continue to make its own credit analysis, appraisals and decisions in
taking or not taking action under this Agreement and the other Loan Documents,
and to make such investigations as it deems necessary to inform itself as to
the business, prospects, operations, property, financial and other condition
and creditworthiness of the Borrower. 
Except for notices, reports and other documents expressly required to be
furnished to the Lenders by the Administrative Agent herein, the Administrative
Agent shall not have any duty or responsibility to provide any Lender with any
credit or other information concerning the business, prospects, operations,
property, financial and other condition or creditworthiness of any of the Loan
Parties or any of their respective Affiliates which may come into the
possession of any Agent-Related Person.


 


9.07                        Indemnification of Administrative Agent.  Whether or not the transactions contemplated
hereby are consummated, the Lenders shall indemnify upon demand each
Agent-Related Person (to the extent not reimbursed by or on behalf of any Loan
Party and without limiting the obligation of any Loan Party to do so), pro
rata, and hold harmless each Agent-Related Person from and against any and all
Indemnified Liabilities incurred by it, including any Indemnified Liabilities in all cases, whether or not caused by or arising, in
whole or in part, out of the negligence of the Indemnitee; provided,
however, that no Lender shall be liable for the payment to any Agent-Related
Person of any portion of such Indemnified Liabilities to the extent determined
in a final, nonappealable judgment by a court of competent jurisdiction to have
resulted from such Agent-Related Person’s own gross negligence or willful
misconduct; provided, however, that no action taken in accordance
with the directions of the Required Lenders shall be deemed to constitute gross
negligence or willful misconduct for purposes of this Section.  Without limitation of the foregoing, each
Lender shall reimburse the Administrative Agent upon demand for its ratable
share of any costs or out-of-pocket expenses (including


 


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Attorney Costs) incurred by the Administrative Agent in connection with
the preparation, execution, delivery, administration, modification, amendment
or enforcement (whether through negotiations, legal proceedings or otherwise)
of, or legal advice in respect of rights or responsibilities under, this
Agreement, any other Loan Document, or any document contemplated by or referred
to herein, to the extent that the Administrative Agent is not reimbursed for
such expenses by or on behalf of the Borrower. 
The undertaking in this Section shall survive termination of the
Aggregate Commitments, the payment of all other Obligations and the resignation
of the Administrative Agent.


 


9.08                        Administrative Agent in its Individual Capacity.  Bank of America and its Affiliates may make
loans to, issue letters of credit for the account of, accept deposits from,
acquire equity interests in and generally engage in any kind of banking, trust,
financial advisory, underwriting or other business with each of the Loan
Parties and their respective Affiliates as though Bank of America were not the
Administrative Agent or the L/C Issuer hereunder and without notice to or
consent of the Lenders.  The Lenders
acknowledge that, pursuant to such activities, Bank of America or its
Affiliates may receive information regarding any Loan Party or its Affiliates
(including information that may be subject to confidentiality obligations in
favor of such Loan Party or such Affiliate) and acknowledge that the
Administrative Agent shall be under no obligation to provide such information
to them.  With respect to its Loans,
Bank of America shall have the same rights and powers under this Agreement as
any other Lender and may exercise such rights and powers as though it were not
the Administrative Agent or the L/C Issuer, and the terms “Lender” and
“Lenders” include Bank of America in its individual capacity.


 


9.09                        Successor Administrative Agent.  The Administrative Agent may resign as
Administrative Agent upon 30 days’ notice to the Lenders.  If the Administrative Agent resigns under
this Agreement, the Required Lenders shall appoint from among the Lenders a
successor administrative agent for the Lenders, which successor administrative
agent shall be consented to by the Borrower at all times other than during the
existence of an Event of Default (which consent of the Borrower shall not be unreasonably
withheld or delayed).  If no successor
administrative agent is appointed prior to the effective date of the
resignation of the Administrative Agent, the Administrative Agent may appoint,
after consulting with the Lenders and the Borrower, a successor administrative
agent from among the Lenders; provided that if the Administrative Agent shall
notify the Borrower and the Lenders that no qualifying Person has accepted such
appointment, then such resignation shall nonetheless become effective in accordance
with such notice and (1) the retiring Administrative Agent shall be discharged
from its duties and obligations hereunder and under the other Loan Documents
(except that in the case of any collateral security held by the Administrative
Agent on behalf of the Lenders or the L/C Issuer under any of the Loan
Documents, the retiring Administrative Agent shall continue to hold such
collateral security until such time as a successor Administrative Agent is
appointed) and (2) all payments, communications and determinations provided to
be made by, to or through the Administrative Agent shall instead be made by or
to each Lender and the L/C Issuer directly, until such time as the Required
Lenders appoint a successor Administrative Agent as provided for above in this
Section.  Upon the acceptance of its
appointment as successor administrative agent hereunder, the Person acting as
such successor administrative agent shall succeed to all the rights, powers and
duties of the retiring Administrative Agent and the term “Administrative Agent”
shall mean such successor administrative agent and the retiring Administrative
Agent’s


 


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appointment, powers and duties as Administrative Agent shall be
terminated, without any other or further act or deed on the part of such
retiring Administrative Agent.  After
any retiring Administrative Agent’s resignation hereunder as Administrative
Agent, the provisions of this Article IX and Sections 10.04
and 10.05 shall inure to its benefit as to any actions taken or omitted
to be taken by it while it was Administrative Agent under this Agreement.


 


Any resignation by Bank of America as Administrative Agent pursuant to
this Section shall also constitute its resignation as L/C Issuer.  Upon the acceptance of a successor’s
appointment as Administrative Agent hereunder, (a) such successor shall succeed
to and become vested with all of the rights, powers, privileges and duties of
the retiring L/C Issuer, (b) the retiring L/C Issuer shall be discharged from
all of their respective duties and obligations hereunder or under the other
Loan Documents, and (c) the successor L/C Issuer shall issue letters of credit
in substitution for the Letters of Credit, if any, outstanding at the time of
such succession or make other arrangement satisfactory to the retiring L/C
Issuer to effectively assume the obligations of the retiring L/C Issuer with
respect to such Letters of Credit.


 


9.10                        Administrative Agent May File Proofs of Claim.  In case of the pendency of any receivership,
insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,
composition or other judicial proceeding relative to any Loan Party, the
Administrative Agent (irrespective of whether the principal of any Loan or L/C
Obligation shall then be due and payable as herein expressed or by declaration
or otherwise and irrespective of whether the Administrative Agent shall have
made any demand on the Borrower) shall be entitled and empowered, by
intervention in such proceeding or otherwise


 


(a)                                  to
file and prove a claim for the whole amount of the principal and interest owing
and unpaid in respect of the Loans, L/C Obligations and all other Obligations
that are owing and unpaid and to file such other documents as may be necessary
or advisable in order to have the claims of the Lenders and the Administrative
Agent (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Lenders and the Administrative Agent and
their respective agents and counsel and all other amounts due the Lenders and
the Administrative Agent under Sections 2.03(i) and 2.03(j), 2.08
and 10.04) allowed in such judicial proceeding; and


 


(b)                                 to
collect and receive any monies or other property payable or deliverable on any
such claims and to distribute the same;


 


and any custodian, receiver, assignee, trustee, liquidator,
sequestrator or other similar official in any such judicial proceeding is
hereby authorized by each Lender to make such payments to the Administrative
Agent and, in the event that the Administrative Agent shall consent to the
making of such payments directly to the Lenders, to pay to the Administrative
Agent any amount due for the reasonable compensation, expenses, disbursements
and advances of the Administrative Agent and its agents and counsel, and any
other amounts due the Administrative Agent under Sections 2.08 and 10.04.


 


Nothing contained herein shall be deemed to authorize the
Administrative Agent to authorize or consent to or accept or adopt on behalf of
any Lender any plan of reorganization,


 


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arrangement, adjustment or composition affecting the Obligations or the
rights of any Lender or to authorize the Administrative Agent to vote in
respect of the claim of any Lender in any such proceeding.


 


9.11                        Collateral and Guaranty Matters.  The Lenders irrevocably authorize the
Administrative Agent, at its option and in its discretion,


 


(a)                                  to
release any Lien on any property granted to or held by the Administrative Agent
under any Loan Document (i) upon termination of the Aggregate Commitments and
payment in full of all Obligations (other than contingent indemnification
obligations) and the expiration or termination of all Letters of Credit, (ii)
that is part of a Disposition of property permitted hereunder or under any
other Loan Document or is permitted to be released under Section 6.13,
or (iii) subject to Section 10.01, if approved, authorized or
ratified in writing by the Required Lenders;


 


(b)                                 to
subordinate any Lien on any property granted to or held by the Administrative
Agent under any Loan Document to the holder of any Lien on such property that
is permitted by Section 7.01(i); and


 


(c)                                  to
release any Guarantor from its obligations under the Guaranty if such Person
ceases to be a Subsidiary as a result of a transaction permitted hereunder or
ceases to be a Guarantor as provided under Section 6.13.


 


Upon request by the Administrative Agent at any time, the Required
Lenders will confirm in writing the Administrative Agent’s authority to release
or subordinate its interest in particular types or items of property, or to
release any Guarantor from its obligations under the Guaranty pursuant to this Section 9.11.


 


9.12                        Other Agents; Arrangers and Managers.  None of the Lenders or other Persons
identified on the facing page or signature pages of this Agreement as a
“syndication agent,” “documentation agent,” “co-agent,” “book manager,” “lead
manager,” “arranger,” “lead arranger” or “co-arranger” shall have any right, power,
obligation, liability, responsibility or duty under this Agreement other than,
in the case of such Lenders, those applicable to all Lenders as such.  Without limiting the foregoing, none of the
Lenders or other Persons so identified shall have or be deemed to have any
fiduciary relationship with any Lender. 
Each Lender acknowledges that it has not relied, and will not rely, on
any of the Lenders or other Persons so identified in deciding to enter into
this Agreement or in taking or not taking action hereunder.


 


ARTICLE X.

MISCELLANEOUS


 


10.01                 Amendments, Etc. 
No amendment or waiver of any provision of this Agreement or any other
Loan Document, and no consent to any departure by the Borrower or any other
Loan Party therefrom, shall be effective unless in writing signed by the
Required Lenders and the Borrower or the applicable Loan Party, as the case may
be, and acknowledged by the Administrative Agent, and each such waiver or
consent shall be effective only in the specific


 


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instance and for the specific purpose for which given; provided,
however, that no such amendment, waiver or consent shall:


 


(a)                                  waive
any condition set forth in Section 4.01(a) or (b) without
the written consent of each Lender;


 


(b)                                 extend
or increase the Commitment of any Lender (or reinstate any Commitment
terminated pursuant to Section 8.02) without the written consent of
such Lender;


 


(c)                                  postpone
any date fixed by this Agreement or any other Loan Document for any payment of
principal, interest, fees or other amounts due to the Lenders (or any of them)
hereunder or under any other Loan Document without the written consent of each
Lender directly affected thereby;


 


(d)                                 reduce
the principal of, or the rate of interest specified herein on, any Loan or L/C
Borrowing, or (subject to clause (iii) of the second proviso to this Section 10.01)
any fees or other amounts payable hereunder or under any other Loan Document,
or change the manner of computation of any financial ratio (including any
change in any applicable defined term) used in determining the Applicable Rate
that would result in a reduction of any interest rate on any Loan or any fee
payable hereunder without the written consent of each Lender directly affected
thereby; provided, however, that only the consent of the Required
Lenders shall be necessary (i) to waive any obligation of the Borrower to pay
interest at the Default Rate or (ii) to amend any financial covenant hereunder
(or any defined term used therein) even if the effect of such amendment would
be to reduce the rate of interest on any Loan or L/C Borrowing or to reduce any
fee payable hereunder;


 


(e)                                  change
Section 2.12 or Section 8.03 in a manner that would
alter the pro rata sharing of payments required thereby without the written
consent of each Lender;


 


(f)                                    change
any provision of this Section or the definition of “Required Lenders” or
any other provision hereof specifying the number or percentage of Lenders
required to amend, waive or otherwise modify any rights hereunder or make any
determination or grant any consent hereunder, without the written consent of
each Lender;


 


(g)                                 release
any Guarantor from the Guaranty without the written consent of each Lender
unless authorized by Section 6.13 or Section 9.11(c) or
required by any applicable PUC or FERC; or


 


(h)                                 release
any Collateral from any Security Document without the written consent of each
Lender unless authorized such release is authorized by Section 6.13
or Section 9.11(a) or required by any applicable PUC or FERC.


 


and, provided  further, that (i) no amendment, waiver or
consent shall, unless in writing and signed by the L/C Issuer in addition to
the Lenders required above, affect the rights or duties of the L/C Issuer under
this Agreement or any Letter of Credit Application relating to any Letter of
Credit issued or to be issued by it; (ii) no amendment, waiver or consent
shall, unless in writing and signed by the Administrative Agent in addition to
the Lenders required above, affect the


 


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rights or duties of the Administrative Agent under this Agreement or
any other Loan Document; and (iii) the Fee Letter may be amended, or rights or
privileges thereunder waived, in a writing executed only by the parties thereto.  Notwithstanding anything to the contrary
herein, no Defaulting Lender shall have any right to approve or disapprove any
amendment, waiver or consent hereunder, except that the Commitment of such
Lender may not be increased or extended without the consent of such Lender.


 


10.02                 Notices and Other Communications; Facsimile Copies.


 


(a)                                  General.  Unless otherwise expressly provided herein,
all notices and other communications provided for hereunder shall be in writing
(including by facsimile transmission). 
All such written notices shall be mailed, faxed or delivered to the
applicable address, facsimile number or (subject to subsection (c) below)
electronic mail address, and all notices and other communications expressly
permitted hereunder to be given by telephone shall be made to the applicable
telephone number, as follows:


 


(i)                                     if
to the Borrower, the Administrative Agent or the L/C Issuer, to the address,
facsimile number, electronic mail address or telephone number specified for
such Person on Schedule 10.02
or to such other address, facsimile number, electronic mail address or
telephone number as shall be designated by such party in a notice to the other
parties; and


 


(ii)                                  if
to any other Lender, to the address, facsimile number, electronic mail address
or telephone number specified in its Administrative Questionnaire or to such
other address, facsimile number, electronic mail address or telephone number as
shall be designated by such party in a notice to the Borrower, the
Administrative Agent and the L/C Issuer.


 


All such notices and other communications shall be deemed to be given
or made upon the earlier to occur of (i) actual receipt by the relevant party
hereto and (ii) (A) if delivered by hand or by courier, when signed for by or
on behalf of the relevant party hereto; (B) if delivered by mail, four Business
Days after deposit in the mails, postage prepaid; (C) if delivered by
facsimile, when sent and receipt has been confirmed by telephone; and (D) if
delivered by electronic mail (which form of delivery is subject to the
provisions of subsection (c) below), when delivered; provided, however,
that notices and other communications to the Administrative Agent and the L/C
Issuer pursuant to Article II shall not be effective until actually
received by such Person.  In no event
shall a voicemail message be effective as a notice, communication or
confirmation hereunder.


 


(b)                                 Effectiveness
of Facsimile Documents and Signatures. 
Loan Documents may be transmitted and/or signed by facsimile.  The effectiveness of any such documents and
signatures shall, subject to applicable Law, have the same force and effect as
manually-signed originals and shall be binding on all Loan Parties, the
Administrative Agent and the Lenders. 
The Administrative Agent may also require that any such documents and
signatures be confirmed by a manually-signed original thereof; provided,
however, that the failure to request or deliver the same shall not limit
the effectiveness of any facsimile document or signature.


 


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(c)                                  Limited
Use of Electronic Mail.  Electronic
mail and Internet and intranet websites may be used only to distribute routine
communications, such as financial statements and other information as provided
in Section 6.01 and Section 6.02, and to distribute
Loan Documents for execution by the parties thereto, and may not be used for
any other purpose.


 


(d)                                 Reliance
by Administrative Agent and Lenders. 
The Administrative Agent and the Lenders shall be entitled to rely and
act upon any notices issued in accordance with Section 10.02(a)
(including telephonic Loan Notices) purportedly given by or on behalf of the
Borrower even if (i) such notices were not made in a manner specified herein,
were incomplete or were not preceded or followed by any other form of notice
specified herein, or (ii) the terms thereof, as understood by the recipient,
varied from any confirmation thereof. 
The Borrower shall indemnify each Agent-Related Person and each Lender
from all losses, costs, expenses and liabilities resulting from the reliance by
such Person on each notice purportedly given by or on behalf of the
Borrower.  All telephonic notices to and
other communications with the Administrative Agent may be recorded by the
Administrative Agent, and each of the parties hereto hereby consents to such
recording.


 


10.03                 No Waiver; Cumulative Remedies.  No failure by any Lender or the
Administrative Agent to exercise, and no delay by any such Person in
exercising, any right, remedy, power or privilege hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right, remedy,
power or privilege hereunder preclude any other or further exercise thereof or
the exercise of any other right, remedy, power or privilege.  The rights, remedies, powers and privileges
herein provided are cumulative and not exclusive of any rights, remedies,
powers and privileges provided by law.


 


10.04                 Attorney Costs, Expenses and Taxes.  The Borrower agrees (a) to pay or reimburse
the Administrative Agent for all reasonable costs and expenses incurred in
connection with the development, preparation, negotiation and execution of this
Agreement and the other Loan Documents and any amendment, waiver, consent or
other modification of the provisions hereof and thereof (whether or not the
transactions contemplated hereby or thereby are consummated), and the
consummation and administration of the transactions contemplated hereby and
thereby, including all Attorney Costs, and (b) to pay or reimburse the Administrative
Agent and each Lender for all reasonable costs and expenses incurred in
connection with the enforcement, attempted enforcement, or preservation of any
rights or remedies under this Agreement or the other Loan Documents (including
all such costs and expenses incurred during any “workout” or restructuring in
respect of the Obligations and during any legal proceeding, including any
proceeding under any Debtor Relief Law), including all Attorney Costs.  The foregoing costs and expenses shall
include all reasonable search, filing, recording, title insurance and appraisal
charges and fees and taxes related thereto, and other out-of-pocket expenses
incurred by the Administrative Agent and the reasonable cost of independent
public accountants and other outside experts retained by the Administrative
Agent or any Lender.  All amounts due
under this Section 10.04 shall be payable within ten Business Days
after demand therefor.  The agreements
in this Section shall survive the termination of the Aggregate Commitments
and repayment of all other Obligations.


 


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10.05                 Indemnification by the Borrower.  Whether or not the transactions contemplated
hereby are consummated, the Borrower shall indemnify and hold harmless each
Agent-Related Person, each Lender and their respective Affiliates, directors,
officers, employees, counsel, agents and attorneys-in-fact (collectively the “Indemnitees”)
from and against any and all liabilities, obligations, losses, damages,
penalties, claims, demands, actions, judgments, suits, costs, expenses and
disbursements (including Attorney Costs) of any kind or nature whatsoever which
may at any time be imposed on, incurred by or asserted against any such
Indemnitee by any third party or by any Loan
Party or in any way relating to or arising out of or in connection
with (a) the execution, delivery, enforcement, performance or administration of
any Loan Document or any other agreement, letter or instrument delivered in
connection with the transactions contemplated thereby or the consummation of
the transactions contemplated thereby, (b) any Commitment, Loan or Letter of
Credit or the use or proposed use of the proceeds therefrom (including any
refusal by the L/C Issuer to honor a demand for payment under a Letter of
Credit if the documents presented in connection with such demand do not
strictly comply with the terms of such Letter of Credit), (c) any actual or alleged presence or release of
Hazardous Materials on or from any property currently or formerly owned or
operated by the Borrower, any Subsidiary or any other Loan Party, or any
Environmental Liability related in any way to the Borrower, any Subsidiary or
any other Loan Party, or (d) any actual or prospective claim,
litigation, investigation or proceeding relating to any of the foregoing,
whether based on contract, tort or any other theory (including any
investigation of, preparation for, or defense of any pending or threatened
claim, investigation, litigation or proceeding) and regardless of whether any
Indemnitee is a party thereto (all the foregoing, collectively, the “Indemnified
Liabilities”), in all cases, whether or
not caused by or arising, in whole or in part, out of the negligence of the
Indemnitee; provided that such indemnity shall not, as to any
Indemnitee, be available to the extent that such liabilities, obligations,
losses, damages, penalties, claims, demands, actions, judgments, suits, costs,
expenses or disbursements are determined by a court of competent jurisdiction
by final and nonappealable judgment to have resulted from the gross negligence
or willful misconduct of such Indemnitee. 
No Indemnitee shall be liable for any damages arising from the use by
others of any information or other materials obtained through IntraLinks or
other similar information transmission systems in connection with this
Agreement, nor shall any Indemnitee have any liability for any indirect or
consequential damages relating to this Agreement or any other Loan Document or
arising out of its activities in connection herewith or therewith (whether
before or after the Closing Date).  All
amounts due under this Section 10.05 shall be payable within ten
Business Days after demand therefor. 
The agreements in this Section shall survive the resignation of the
Administrative Agent, the replacement of any Lender, the termination of the
Aggregate Commitments and the repayment, satisfaction or discharge of all the
other Obligations.


 


10.06                 Reimbursement by Lenders.  To the extent that the Borrower for any reason fails to
indefeasibly pay any amount required under Sections 10.04 or 10.05
to be paid by it to the Administrative Agent (or any sub-agent thereof), the
L/C Issuer or any Agent-Related Person of any of the foregoing, each Lender
severally agrees to pay to the Administrative Agent (or any such sub-agent),
the L/C Issuer or such Agent-Related Person, as the case may be, such Lender’s
Applicable Percentage (determined as of the time that the applicable
unreimbursed expense or indemnity payment is sought) of such unpaid amount, provided
that the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the case may be, was incurred by


 


73

















 


or asserted against the Administrative Agent (or any such sub-agent) or
the L/C Issuer in its capacity as such, or against any Agent-Related Person of
any of the foregoing acting for the Administrative Agent (or any such
sub-agent) or L/C Issuer in connection with such capacity.  The obligations of the Lenders under this Section 10.06
are subject to the provisions of Section 2.11(d).


 


10.07                 Payments Set Aside. 
To the extent that any payment by or on behalf of the Borrower is made
to the Administrative Agent or any Lender, or the Administrative Agent or any
Lender exercises its right of set-off, and such payment or the proceeds of such
set-off or any part thereof is subsequently invalidated, declared to be
fraudulent or preferential, set aside or required (including pursuant to any
settlement entered into by the Administrative Agent or such Lender in its
discretion) to be repaid to a trustee, receiver or any other party, in
connection with any proceeding under any Debtor Relief Law or otherwise, then
(a) to the extent of such recovery, the obligation or part thereof originally
intended to be satisfied shall be revived and continued in full force and
effect as if such payment had not been made or such set-off had not occurred,
and (b) each Lender severally agrees to pay to the Administrative Agent upon
demand its applicable share of any amount so recovered from or repaid by the
Administrative Agent, plus interest thereon from the date of such demand to the
date such payment is made at a rate per annum equal to the Federal Funds Rate
from time to time in effect.


 


10.08                 Successors and Assigns.


 


(a)                                  The
provisions of this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and assigns permitted
hereby, except that the Borrower may not assign or otherwise transfer any of
its rights or obligations hereunder without the prior written consent of each
Lender and no Lender may assign or otherwise transfer any of its rights or
obligations hereunder except (i) to an Eligible Assignee in accordance with the
provisions of subsection (b) of this Section, (ii) by way of participation
in accordance with the provisions of subsection (d) of this Section, or
(iii) by way of pledge or assignment of a security interest subject to the
restrictions of subsection (f) of this Section (and any other
attempted assignment or transfer by any party hereto shall be null and
void).  Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby,
Participants to the extent provided in subsection (d) of this
Section and, to the extent expressly contemplated hereby, the Indemnitees)
any legal or equitable right, remedy or claim under or by reason of this
Agreement.


 


(b)                                 Any
Lender may at any time assign to one or more Eligible Assignees all or a
portion of its rights and obligations under this Agreement (including all or a
portion of its Commitment and the Loans (including for purposes of this
subsection (b), participations in L/C Obligations) at the time owing to
it); provided that (i) except in the case of an assignment of the entire
remaining amount of the assigning Lender’s Commitment and the Loans at the time
owing to it or in the case of an assignment to a Lender or an Affiliate of a
Lender or an Approved Fund (as defined in subsection (g) of this Section)
with respect to a Lender, the aggregate amount of the Commitment (which for
this purpose includes Loans outstanding thereunder) subject to each such assignment,
determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent or, if “Trade Date” is
specified in the


 


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Assignment and Assumption, as of the Trade Date, shall not be less than
$5,000,000 unless each of the Administrative Agent and, so long as no Event of
Default has occurred and is continuing, the Borrower otherwise consents (each
such consent not to be unreasonably withheld or delayed); (ii) each partial
assignment shall be made as an assignment of a proportionate part of all the
assigning Lender’s rights and obligations under this Agreement with respect to
the Loans or the Commitment assigned; (iii) any assignment of a Commitment must
be approved by the Administrative Agent and the L/C Issuer unless the Person
that is the proposed assignee is itself a Lender (whether or not the proposed
assignee would otherwise qualify as an Eligible Assignee); and (iv) the parties
to each assignment shall execute and deliver to the Administrative Agent an
Assignment and Assumption, together with a processing and recordation fee of
$3,500.  Subject to acceptance and
recording thereof by the Administrative Agent pursuant to subsection (c)
of this Section, from and after the effective date specified in each Assignment
and Assumption, the Eligible Assignee thereunder shall be a party to this
Agreement and, to the extent of the interest assigned by such Assignment and
Assumption, have the rights and obligations of a Lender under this Agreement,
and the assigning Lender thereunder shall, to the extent of the interest
assigned by such Assignment and Assumption, be released from its obligations
under this Agreement (and, in the case of an Assignment and Assumption covering
all of the assigning Lender’s rights and obligations under this Agreement, such
Lender shall cease to be a party hereto but shall continue to be entitled to
the benefits of Sections 3.01, 3.04, 3.05,  10.04
and 10.05, with respect to facts and circumstances occurring prior to
the effective date of such assignment). 
Upon request, the Borrower (at its expense) shall execute and deliver a
Note to the assignee Lender.  Any assignment
or transfer by a Lender of rights or obligations under this Agreement that does
not comply with this subsection shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with subsection (d) of this Section.


 


(c)                                  The
Administrative Agent, acting solely for this purpose as an agent of the
Borrower, shall maintain at the Administrative Agent’s Office a copy of each
Assignment and Assumption delivered to it and a register for the recordation of
the names and addresses of the Lenders, and the Commitments of, and principal
amounts of the Loans and L/C Obligations owing to, each Lender pursuant to the
terms hereof from time to time (the “Register”).  The entries in the Register shall be
conclusive, and the Borrower, the Administrative Agent and the Lenders may
treat each Person whose name is recorded in the Register pursuant to the terms
hereof as a Lender hereunder for all purposes of this Agreement,
notwithstanding notice to the contrary. 
The Register shall be available for inspection by the Borrower and any
Lender, at any reasonable time and from time to time upon reasonable prior
notice.


 


(d)                                 Any
Lender may at any time, without the consent of, or notice to, the Borrower or
the Administrative Agent, sell participations to any Person (other than a
natural person or the Borrower or any of the Borrower’s Affiliates or
Subsidiaries) (each, a “Participant”) in all or a portion of such
Lender’s rights and/or obligations under this Agreement (including all or a
portion of its Commitment and/or the Loans (including such Lender’s
participations in L/C Obligations) owing to it); provided that (i) such
Lender’s obligations under this Agreement shall remain unchanged, (ii) such
Lender shall remain solely responsible to the other parties hereto for the
performance of such obligations and (iii) the Borrower, the Administrative
Agent and the other Lenders shall continue to deal solely and directly with
such


 


75

















 


Lender in
connection with such Lender’s rights and obligations under this Agreement.  Any agreement or instrument pursuant to
which a Lender sells such a participation shall provide that such Lender shall
retain the sole right to enforce this Agreement and to approve any amendment,
modification or waiver of any provision of this Agreement; provided that
such agreement or instrument may provide that such Lender will not, without the
consent of the Participant, agree to any amendment, waiver or other
modification described in the first proviso to Section 10.01 that
directly affects such Participant. 
Subject to subsection (e) of this Section, the Borrower agrees that
each Participant shall be entitled to the benefits of Sections 3.01, 3.04
and 3.05 to the same extent as if it were a Lender and had acquired its
interest by assignment pursuant to subsection (b) of this Section.  To the extent permitted by law, each
Participant also shall be entitled to the benefits of Section 10.09
as though it were a Lender, provided such Participant agrees to be
subject to Section 2.12 as though it were a Lender.


 


(e)                                  A
Participant shall not be entitled to receive any greater payment under Section 3.01
or 3.04 than the applicable Lender would have been entitled to receive
with respect to the participation sold to such Participant, unless the sale of
the participation to such Participant is made with the Borrower’s prior written
consent.  A Participant that would be a
Foreign Lender if it were a Lender shall not be entitled to the benefits of Section 3.01
unless the Borrower is notified of the participation sold to such Participant
and such Participant agrees, for the benefit of the Borrower, to comply with Section 10.15
as though it were a Lender.


 


(f)                                    Any
Lender may at any time pledge or assign a security interest in all or any
portion of its rights under this Agreement (including under its Note, if any)
to secure obligations of such Lender, including any pledge or assignment to
secure obligations to a Federal Reserve Bank; provided that no such
pledge or assignment shall release such Lender from any of its obligations
hereunder or substitute any such pledgee or assignee for such Lender as a party
hereto.


 


(g)                                 As
used herein, the following terms have the following meanings:


 


“Approved Fund” means any Fund that is
administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an
entity or an Affiliate of an entity that administers or manages a Lender.


 


“Eligible Assignee” means (a) a
Lender; (b) an Affiliate of a Lender; (c) an Approved Fund; and (d) any other
Person (other than a natural person) approved by (i) the Administrative Agent
and the L/C Issuer, and (ii) unless an Event of Default has occurred and is
continuing, the Borrower (each such approval not to be unreasonably withheld or
delayed); provided that notwithstanding the foregoing, “Eligible
Assignee” shall not include the Borrower or any of the Borrower’s Affiliates or
Subsidiaries and, provided further, that any such Eligible Assignee
shall have capital and surplus in excess of $1,000,000,000 and, in
Administrative Agent’s reasonable opinion, has experience in lending to
companies in the oil and gas business.


 


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“Fund” means any Person (other than a
natural person) that is (or will be) engaged in making, purchasing, holding or
otherwise investing in commercial loans and similar extensions of credit in the
ordinary course of its business.


 


10.09                 Confidentiality.  Each of the Administrative Agent and the
Lenders agrees to maintain the confidentiality of the Information (as defined
below), except that Information may be disclosed (a) to its and its Affiliates’
directors, officers, employees and agents, including accountants, legal counsel
and other advisors (it being understood that the Persons to whom such
disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential); (b) to the
extent requested by any regulatory authority; (c) to the extent required by
applicable laws or regulations or by any subpoena or similar legal process; (d)
to any other party to this Agreement; (e) in connection with the exercise of
any remedies hereunder or any suit, action or proceeding relating to this
Agreement or the enforcement of rights hereunder; (f) subject to an agreement
containing provisions substantially the same as those of this Section, to (i)
any Eligible Assignee of or Participant in, or any prospective Eligible
Assignee of or Participant in, any of its rights or obligations under this
Agreement or (ii) any direct or indirect contractual counterparty or
prospective counterparty (or such contractual counterparty’s or prospective
counterparty’s professional advisor) to any credit derivative transaction
relating to obligations of the Loan Parties; (g) with the consent of the
Borrower; (h) to the extent such Information (i) becomes publicly available
other than as a result of a breach of this Section or (ii) becomes
available to the Administrative Agent or any Lender on a nonconfidential basis
from a source other than the Borrower; or (i) to the National Association of
Insurance Commissioners or any other similar organization.  In addition, the Administrative Agent and
the Lenders may disclose the existence of this Agreement and information about
this Agreement to market data collectors, similar service providers to the
lending industry, and service providers to the Administrative Agent and the
Lenders in connection with the administration and management of this Agreement,
the other Loan Documents, the Commitments, and the Credit Extensions.  For the purposes of this Section, “Information”
means all information received from any Loan Party relating to any Loan Party
or its business, other than any such information that is available to the
Administrative Agent or any Lender on a nonconfidential basis prior to
disclosure by any Loan Party; provided that, in the case of information
received in writing from a Loan Party after the date hereof, such information
is clearly identified in writing at the time of delivery as confidential.  Any Person required to maintain the
confidentiality of Information as provided in this Section shall be
considered to have complied with its obligation to do so if such Person has
exercised the same degree of care to maintain the confidentiality of such
Information as such Person would accord to its own confidential information.


 


10.10                 Set-off.  In addition to any rights and remedies of
the Lenders provided by law, upon the occurrence and during the continuance of
any Event of Default, each Lender is authorized at any time and from time to
time, without prior notice to the Borrower or any other Loan Party, any such
notice being waived by the Borrower (on its own behalf and on behalf of each
Loan Party) to the fullest extent permitted by law, to set off and apply any
and all deposits (general or special, time or demand, provisional or final) at
any time held by, and other indebtedness at any time owing by, such Lender to
or for the credit or the account of the respective Loan Parties against any and
all Obligations owing to such Lender hereunder or under


 


77

















 


any other Loan Document, now or hereafter existing, irrespective of
whether or not the Administrative Agent or such Lender shall have made demand under
this Agreement or any other Loan Document and although such Obligations may be
contingent or unmatured or denominated in a currency different from that of the
applicable deposit or indebtedness. 
Each Lender agrees promptly to notify the Borrower and the
Administrative Agent after any such set-off and application made by such
Lender; provided, however, that the failure to give such notice
shall not affect the validity of such set-off and application.


 


10.11                 Interest Rate Limitation. 
Agent, LC Issuer, Lenders, the Borrower and Guarantors intend to
contract in strict compliance with applicable usury law from time to time in
effect.  In furtherance thereof such
Persons stipulate and agree that none of the terms and provisions contained in
the Loan Documents shall ever be construed to create a contract to pay, for the
use, forbearance or detention of money, interest in excess of the maximum
amount of interest permitted to be charged by applicable law from time to time
in effect.  Neither the Borrower nor any
Guarantor nor any present or future guarantors, endorsers, or other Persons
hereafter becoming liable for payment of any Obligation shall ever be liable
for unearned interest thereon or shall ever be required to pay interest thereon
in excess of the maximum amount that may be lawfully charged under applicable
law from time to time in effect, and the provisions of this section shall
control over all other provisions of the Loan Documents which may be in
conflict or apparent conflict herewith. 
Agent, LC Issuer and Lenders expressly disavow any intention to charge
or collect excessive unearned interest or finance charges in the event the
maturity of any Obligation is accelerated. 
If (a) the maturity of any Obligation is accelerated for any reason, (b)
any Obligation is prepaid and as a result any amounts held to constitute
interest are determined to be in excess of the legal maximum, or (c) Agent, LC
Issuer or any Lender or any other holder of any or all of the Obligations shall
otherwise collect moneys which are determined to constitute interest which
would otherwise increase the interest on any or all of the Obligations to an
amount in excess of that permitted to be charged by applicable law then in
effect, then all sums determined to constitute interest in excess of such legal
limit shall, without penalty, be promptly applied to reduce the then
outstanding principal of the related Obligations or, at Agent’s, LC Issuer’s or
such Lender’s or holder’s option, promptly returned to the Borrower or the
other payor thereof upon such determination. 
In determining whether or not the interest paid or payable, under any
specific circumstance, exceeds the maximum amount permitted under applicable
law, Agent, LC Issuer, Lenders and the Related Persons (and any other payors
thereof) shall to the greatest extent permitted under applicable law, (i)
characterize any non-principal payment as an expense, fee or premium rather
than as interest, (ii) exclude voluntary prepayments and the effects thereof,
and (iii) amortize, prorate, allocate, and spread the total amount of interest
throughout the entire contemplated term of the instruments evidencing the
Obligations in accordance with the amounts outstanding from time to time
thereunder and the maximum legal rate of interest from time to time in effect
under applicable law in order to lawfully charge the maximum amount of interest
permitted under applicable law.  In the
event applicable law provides for an interest ceiling under Chapter 303 of the
Texas Finance Code, as amended, for that day, the ceiling shall be the “weekly
ceiling” as defined in the Texas Finance Code, provided that if any applicable
law permits greater interest, the law permitting the greatest interest shall
apply and shall be used when appropriate in determining the Highest Lawful
Rate.  As used in this section the
term “applicable law” means the laws of the


 


78

















 


State of Texas or the laws of the United States of America, whichever
laws allow the greater interest, as such laws now exist or may be changed or
amended or come into effect in the future.


 


10.12                 Counterparts.  This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.  This Agreement may be duly executed by
facsimile or other electronic transmission.


 


10.13                 Integration.  This Agreement, together with the other Loan
Documents, comprises the complete and integrated agreement of the parties on the
subject matter hereof and thereof and supersedes all prior agreements, written
or oral, on such subject matter.  In the
event of any conflict between the provisions of this Agreement and those of any
other Loan Document, the provisions of this Agreement shall control; provided
that the inclusion of supplemental rights or remedies in favor of the
Administrative Agent or the Lenders in any other Loan Document shall not be
deemed a conflict with this Agreement. 
Each Loan Document was drafted with the joint participation of the
respective parties thereto and shall be construed neither against nor in favor
of any party, but rather in accordance with the fair meaning thereof.


 


10.14                 Survival of Representations and Warranties.  All representations and warranties made
hereunder and in any other Loan Document or other document delivered pursuant
hereto or thereto or in connection herewith or therewith shall survive the
execution and delivery hereof and thereof. 
Such representations and warranties have been or will be relied upon by
the Administrative Agent and each Lender, regardless of any investigation made
by the Administrative Agent or any Lender or on their behalf and
notwithstanding that the Administrative Agent or any Lender may have had notice
or knowledge of any Default at the time of any Credit Extension, and shall
continue in full force and effect as long as any Loan or any other Obligation
hereunder shall remain unpaid or unsatisfied or any Letter of Credit shall
remain outstanding.


 


10.15                 Severability.  If any provision of this Agreement or the
other Loan Documents is held to be illegal, invalid or unenforceable, (a) the
legality, validity and enforceability of the remaining provisions of this
Agreement and the other Loan Documents shall not be affected or impaired
thereby and (b) the parties shall endeavor in good faith negotiations to
replace the illegal, invalid or unenforceable provisions with valid provisions
the economic effect of which comes as close as possible to that of the illegal,
invalid or unenforceable provisions. 
The invalidity of a provision in a particular jurisdiction shall not
invalidate or render unenforceable such provision in any other jurisdiction.


 


10.16                 Tax
Forms.


 


(a)                                  (i)                                     Each
Lender that is not a “United States person” within the meaning of
Section 7701(a)(30) of the Code (a “Foreign Lender”) shall deliver
to the Administrative Agent, prior to receipt of any payment subject to
withholding under the Code (or upon accepting an assignment of an interest
herein), two duly signed completed copies of either IRS Form W-8BEN or any
successor thereto (relating to such Foreign Lender and entitling it to an
exemption from, or reduction of, withholding tax on all


 


79

















 


payments to be made to such Foreign Lender by the Borrower pursuant to
this Agreement) or IRS Form W-8ECI or any successor thereto (relating to all
payments to be made to such Foreign Lender by the Borrower pursuant to this
Agreement) or such other evidence satisfactory to the Borrower and the
Administrative Agent that such Foreign Lender is entitled to an exemption from,
or reduction of, U.S. withholding tax, including any exemption pursuant to
Section 881(c) of the Code. 
Thereafter and from time to time, each such Foreign Lender shall (A)
promptly submit to the Administrative Agent such additional duly completed and
signed copies of one of such forms (or such successor forms as shall be adopted
from time to time by the relevant United States taxing authorities) as may then
be available under then current United States laws and regulations to avoid, or
such evidence as is satisfactory to the Borrower and the Administrative Agent
of any available exemption from or reduction of, United States withholding
taxes in respect of all payments to be made to such Foreign Lender by the
Borrower pursuant to this Agreement, (B) promptly notify the Administrative
Agent of any change in circumstances which would modify or render invalid any
claimed exemption or reduction, and (C) take such steps as shall not be
materially disadvantageous to it, in the reasonable judgment of such Lender,
and as may be reasonably necessary (including the re-designation of its Lending
Office) to avoid any requirement of applicable Laws that the Borrower make any
deduction or withholding for taxes from amounts payable to such Foreign Lender.


 


(ii)                                  Each
Foreign Lender, to the extent it does not act or ceases to act for its own
account with respect to any portion of any sums paid or payable to such Lender
under any of the Loan Documents (for example, in the case of a typical
participation by such Lender), shall deliver to the Administrative Agent on the
date when such Foreign Lender ceases to act for its own account with respect to
any portion of any such sums paid or payable, and at such other times as may be
necessary in the determination of the Administrative Agent (in the reasonable
exercise of its discretion), (A) two duly signed completed copies of the forms
or statements required to be provided by such Lender as set forth above, to
establish the portion of any such sums paid or payable with respect to which
such Lender acts for its own account that is not subject to U.S. withholding
tax, and (B) two duly signed completed copies of IRS Form W-8IMY (or any
successor thereto), together with any information such Lender chooses to
transmit with such form, and any other certificate or statement of exemption
required under the Code, to establish that such Lender is not acting for its
own account with respect to a portion of any such sums payable to such Lender.


 


(iii)                               The
Borrower shall not be required to pay any additional amount to any Foreign
Lender under Section 3.01 (A) with respect to any Taxes required to
be deducted or withheld on the basis of the information, certificates or
statements of exemption such Lender transmits with an IRS Form W-8IMY pursuant
to this Section 10.16(a) or (B) if such Lender shall have failed to
satisfy the foregoing provisions of this Section 10.16(a); provided
that if such Lender shall have satisfied the requirement of this Section 10.16(a)
on the date such Lender became a Lender or ceased to act for its own account
with respect to any payment under any of the Loan Documents, nothing in this Section 10.16(a)
shall relieve the Borrower of its obligation to pay any amounts pursuant


 


80

















 


to Section 3.01 in the event that, as a result of any
change in any applicable law, treaty or governmental rule, regulation or order,
or any change in the interpretation, administration or application thereof,
such Lender is no longer properly entitled to deliver forms, certificates or
other evidence at a subsequent date establishing the fact that such Lender or
other Person for the account of which such Lender receives any sums payable
under any of the Loan Documents is not subject to withholding or is subject to
withholding at a reduced rate.


 


(iv)                              The
Administrative Agent may, without reduction, withhold any Taxes required to be
deducted and withheld from any payment under any of the Loan Documents with
respect to which the Borrower is not required to pay additional amounts under
this Section 10.16(a).


 


(b)                                 Upon
the request of the Administrative Agent, each Lender that is a “United States
person” within the meaning of Section 7701(a)(30) of the Code shall
deliver to the Administrative Agent two duly signed completed copies of IRS
Form W-9.  If such Lender fails to
deliver such forms, then the Administrative Agent may withhold from any
interest payment to such Lender an amount equivalent to the applicable back-up
withholding tax imposed by the Code, without reduction.


 


(c)                                  If
any Governmental Authority asserts that the Administrative Agent did not
properly withhold or backup withhold, as the case may be, any tax or other
amount from payments made to or for the account of any Lender, such Lender
shall indemnify the Administrative Agent therefor, including all penalties and
interest, any taxes imposed by any jurisdiction on the amounts payable to the
Administrative Agent under this Section, and costs and expenses (including
Attorney Costs) of the Administrative Agent. 
The obligation of the Lenders under this Section shall survive the
termination of the Aggregate Commitments, repayment of all other Obligations
hereunder and the resignation of the Administrative Agent.


 


10.17                 Replacement of Lenders.  Under
any circumstances set forth herein providing that the Borrower shall have the
right to replace a Lender as a party to this Agreement, the Borrower may, upon
notice to such Lender and the Administrative Agent, replace such Lender by
causing such Lender to assign its Commitment (with the assignment fee to be
paid by the Borrower in such instance) pursuant to Section 10.08(b)
to one or more other Lenders or Eligible Assignees procured by the Borrower; provided,
however, that if the Borrower elects to exercise such right with respect
to any Lender pursuant to Section 3.06(b), it shall be obligated to
replace all Lenders that have made similar requests for compensation pursuant to
Section 3.01 or 3.04. 
The Borrower shall (x) pay in full all principal, interest, fees and
other amounts owing to such Lender through the date of replacement (including
any amounts payable pursuant to Section 3.05), (y) provide
appropriate assurances and indemnities (which may include letters of credit) to
the L/C Issuer as it may reasonably require with respect to any continuing
obligation to fund participation interests in any L/C Obligations then
outstanding, and (z) release such Lender from its obligations under the Loan
Documents.  Any Lender being replaced
shall execute and deliver an Assignment and Assumption with respect to such
Lender’s Commitment and outstanding Loans and participations in L/C Obligations.


 


81

















 


10.18                 Governing Law.


 


(a)                                  THIS
AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF
THE STATE OF TEXAS APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY
WITHIN SUCH STATE; PROVIDED THAT THE ADMINISTRATIVE AGENT AND EACH
LENDER SHALL RETAIN ALL RIGHTS ARISING UNDER FEDERAL LAW.


 


(b)                                 ANY
LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS AGREEMENT OR ANY OTHER LOAN
DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF TEXAS SITTING IN DALLAS
OR OF THE UNITED STATES FOR THE NORTHERN DISTRICT OF SUCH STATE, AND BY
EXECUTION AND DELIVERY OF THIS AGREEMENT, THE BORROWER, THE ADMINISTRATIVE
AGENT AND EACH LENDER CONSENTS, FOR ITSELF AND IN RESPECT OF ITS PROPERTY, TO
THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS.  THE BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF
VENUE OR BASED ON THE GROUNDS OF FORUM NON
CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF
ANY ACTION OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN DOCUMENT
OR OTHER DOCUMENT RELATED THERETO.  THE
BORROWER, THE ADMINISTRATIVE AGENT AND EACH LENDER WAIVES PERSONAL SERVICE OF
ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER MEANS
PERMITTED BY THE LAW OF SUCH STATE.


 


CHAPTER 346 OF THE TEXAS FINANCE CODE (THE “TEXAS FINANCE CODE”) AS
AMENDED (WHICH REGULATES CERTAIN REVOLVING CREDIT LOAN ACCOUNTS AND REVOLVING
TRI-PARTY ACCOUNTS) DOES NOT APPLY TO THIS AGREEMENT OR TO THE NOTES.


 


10.19                 Waiver of Right to Trial by Jury.  EACH PARTY TO THIS AGREEMENT HEREBY
EXPRESSLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR
CAUSE OF ACTION ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR
RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH
RESPECT TO ANY LOAN DOCUMENT, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE
WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR
TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL
WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL
COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF
THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF THEIR RIGHT TO TRIAL BY
JURY.


 


10.20                 ENTIRE AGREEMENT.  THIS
AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT AMONG THE
PARTIES AND


 


82

















 


MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG
THE PARTIES.


 


10.21                 Restatement.  This Agreement restates and amends the
Existing Credit Agreement in its entirety, and all of the terms and provisions
hereof shall supersede the terms and provisions thereof.


 


10.22                 Return of Original Mortgage.  Each Lender that was a party to the Existing
Credit Agreement agrees to return to the Borrower its original counterpart of
the Mortgage (as defined in the Existing Credit Agreement), to the extent
practicable.  Each such Lender hereby
further authorizes Administrative Agent to release all liens, security
interests and other rights and interests created by such Mortgage.


 


 


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83

















 


IN WITNESS WHEREOF,
the parties hereto have caused this Agreement to be duly executed as of the
date first above written.


 


 


	
   

  	
  WESTERN GAS RESOURCES, INC.

  
	
   

  
	
   

  
	
   

  	
  By:

  	
   /s/ William J. Krysiak

  	
   

  
	
   

  	
   

  	
  William J. Krysiak

  Executive Vice President and

  Chief Financial Officer

  



 

















 


	
   

  	
  BANK OF AMERICA, N.A.,
as Administrative Agent

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Richard L. Stein

  	
   

  
	
   

  	
  Name:  Richard L. Stein

  
	
   

  	
  Title:  Principal

  



 

















 


	
   

  	
  BANK OF AMERICA, N.A.,
as a Lender and L/C Issuer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Richard L. Stein

  	
   

  
	
   

  	
  Name:  Richard L. Stein

  
	
   

  	
  Title:  Principal

  



 

















 


	
   

  	
  BANK OF OKLAHOMA, N.A.,
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Thomas M. Foncannon

  	
   

  
	
   

  	
  Name:  Thomas M. Foncannon

  
	
   

  	
  Title:  Senior Vice President

  



 

















 


	
   

  	
  BNP PARIBAS, as a
  Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ J. Onischuk 

  	
   

  
	
   

  	
  Name: J. Onischuk

  
	
   

  	
  Title:  Director

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Greg Smothers

  	
   

  
	
   

  	
  Name:  Greg Smothers

  
	
   

  	
  Title: Vice President

  



 

















 


	
   

  	
  COMERICA BANK, as
  a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Peter L. Sefzik

  	
   

  
	
   

  	
  Name:  Peter L. Sefzik 

  
	
   

  	
  Title:  Vice President

  



 

















 


	
   

  	
  COMPASS BANK, as a
  Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ John M. Falbo

  	
   

  
	
   

  	
  Name:  John M. Falbo

  
	
   

  	
  Title:  Senior Vice President

  



 

















 


	
   

  	
  JPMORGAN CHASE BANK,
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Robert C. Mertensotto

  	
   

  
	
   

  	
  Name:  Robert C. Mertensotto

  
	
   

  	
  Title:  Managing Director

  



 

















 


	
   

  	
  KEYBANK NATIONAL ASSOCIATION,
  as a

  Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Thomas Rajan

  	
   

  
	
   

  	
  Name:  Thomas Rajan

  
	
   

  	
  Title:  Vice President

  



 

















 


	
   

  	
  THE ROYAL BANK OF SCOTLAND plc,
as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Kevin J. Howard

  	
   

  
	
   

  	
  Name:  Kevin J. Howard

  
	
   

  	
  Title:  Managing Director

  



 

















 


	
   

  	
  UNION BANK OF CALIFORNIA, N.A.,
as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Kimberly Coil

  	
   

  
	
   

  	
  Name:  Kimberly Coil

  
	
   

  	
  Title:  Assistant Vice
  President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ John Clark

  	
   

  
	
   

  	
  Name:  John Clark

  
	
   

  	
  Title:  Vice President

  



 

















 


	
   

  	
  U.S. BANK NATIONAL ASSOCIATION,
as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Kathryn A. Gaiter

  	
   

  
	
   

  	
  Name:  Kathryn A. Gaiter

  
	
   

  	
  Title: Vice President 

  



 

















 


	
   

  	
  WACHOVIA BANK, NATIONAL

  ASSOCIATION, as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Philip Trinder

  	
   

  
	
   

  	
  Name:  Philip Trinder

  
	
   

  	
  Title:  Vice President

  



 

















 


	
   

  	
  WELLS FARGO BANK, N.A.,
  as a Lender

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   /s/ Karen L. Rogers

  	
   

  
	
   

  	
  Name:  Karen L. Rogers

  
	
   

  	
  Title:  Vice President